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Speaker 1: This is Master's in Business with very Rid Holds on

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Speaker 1: Bloomberg Radio.

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Speaker 2: This week on the podcast, I have an extra special guest,

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Speaker 2: show Meek Data, co founder and managing partner at Overture

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Speaker 2: Climate VC, focuses on all sorts of fascinating startup and

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Speaker 2: climate change technology, from concrete to energy production, to storage,

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Speaker 2: to carbon capture, to material science to well turning the fuels.

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Speaker 2: This is really a fascinating discussion about some of the

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Speaker 2: latest greatest technology that's going to help the world get

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Speaker 2: to a carbon neutral status and maybe even a carbon

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Speaker 2: negative status to roll back the impact of two hundred

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Speaker 2: and fifty years of burning fossil fuels. I found this

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Speaker 2: conversation to be absolutely fascinating, not just because show Meek

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Speaker 2: has a little bit of a political background and had

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Speaker 2: worked in both of Obama's campaign where he was frequently

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Speaker 2: fired by the soon to be president but still managed

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Speaker 2: to maintain his job, but because of his deep and

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Speaker 2: broad knowledge of the technologies behind climate change. He said,

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Speaker 2: this isn't a green investment so much as a money

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Speaker 2: making economic investment, and if you're not paying attention, you're

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Speaker 2: going to miss the opportunity. With no further ado, my

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Speaker 2: conversation with Overture Climate VCS show mc dadda.

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Speaker 1: Erry, thanks for having me.

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Speaker 2: So, what was the original plan? Was it politics or finance?

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Speaker 2: Where were you thinking of going?

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Speaker 1: It was always politics. I grew up a political junkie,

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Speaker 1: worked on Senate races and governor's races, and had the

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Speaker 1: really good fortune of linking up with Barack Obama in

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Speaker 1: two thousand and seven. I was one of the early

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Speaker 1: staffers on that campaign, and it ended up obviously being

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Speaker 1: this incredible rocket ship'll kind of start up in his

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Speaker 1: own right, And it was that experience that convinced me

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Speaker 1: that it's really possible to do big, daring, hard things.

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Speaker 1: Watching the president sort of go from a US senator

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Speaker 1: who's still paying off his law school loans to stepping

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Speaker 1: into the most important job in the world was an

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Speaker 1: inspiring and crazy experience.

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Speaker 2: What did you do for the campaign in eight and

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Speaker 2: then what'd you do in twenty twelve?

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Speaker 1: I was his fundraiser, so I oversaw the mid Atlantic states,

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Speaker 1: about nine states. I was twenty four years old, cocky

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Speaker 1: and a little bit insane. I'd read a lot of

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Speaker 1: books about rom and Manuel, so I thought you were

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Speaker 1: supposed to swear at people and yell and push hard,

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Speaker 1: which I did and proud to say that we outraised

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Speaker 1: Hillary Clinton from the very first day that I joined.

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Speaker 1: I turned down an offer from Hillary Clinton at the time,

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Speaker 1: which you know, my father's a risk averse immigrant, so

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Speaker 1: his two pieces of advice to me were to work

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Speaker 1: at Lehman Brothers from investment banking, good call, and to

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Speaker 1: work for Hillary Clinton, not Barack Obama. But those are

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Speaker 1: the only two things I've ignored his advice on.

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Speaker 2: And your dad's O for two.

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Speaker 1: My dad's one thousand for one thousand and two.

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Speaker 2: But that's great. So how did you go from working

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Speaker 2: in the campaign to working at both the White House

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Speaker 2: and the FCCI.

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Speaker 1: You know, you could say a lot of it was

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Speaker 1: political nepotism. Candidly, I was a you know, coffee boy.

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Speaker 1: I was Greg Craig, the White House Counsel's special assistant,

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Speaker 1: and as puffed up and important as I thought I

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Speaker 1: was on the campaign, when it turns to governing, it

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Speaker 1: turns out you need some specialization. So I quickly realized

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Speaker 1: that I didn't have a sort of path to being

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Speaker 1: the National Security Council Advisor at any point. So I,

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Speaker 1: you know, after serving coffee for about a year working

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Speaker 1: on a Supreme Court nomination, shifted to go work for Julius,

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Speaker 1: who is the FCC chairman. And that's when I realized

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Speaker 1: that a lot of the smartest guys in the room

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Speaker 1: are actually in business more often than not, and got

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Speaker 1: really interested in shifting my career that that direction.

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Speaker 2: So someone interested in doing work in politics, how do

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Speaker 2: you get a foot in the door?

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Speaker 1: You know, it really starts with picking a campaign. And

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Speaker 1: a campaign is like a lot like a startup, with's

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Speaker 1: a really flat organization. You have to raise an unbelievablemount

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Speaker 1: of money and spend it in a short period of time,

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Speaker 1: and you have this discrete objective that everyone's nailed towards.

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Speaker 1: And so for a young there's no better experience than

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Speaker 1: working on a campaign, where if you can get something done,

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Speaker 1: there is a job for you. And so that's where

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Speaker 1: I really cut my teeth, working on campaigns, getting stuff done.

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Speaker 1: And you know, no better boss than Obama.

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Speaker 2: So venture capitalists are notorious for having this really in

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Speaker 2: depth network of high performing, plugged in people. How similar

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Speaker 2: is that to what takes place in the world of

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Speaker 2: political networking.

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Speaker 1: It's fine. I heard doug Ley Owne, the founder of

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Speaker 1: the managing partner at Sequoia, have this great phrasing, there's

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Speaker 1: many paths to heaven, And it seems in venture capital

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Speaker 1: there are many paths to heaven. Right. You can have

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Speaker 1: a really well networked media executive, as was Mike Moritz

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Speaker 1: at the time. You can have drilled down operators who

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Speaker 1: have run businesses. There are many different ways venture capitalists

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Speaker 1: can add value. And it was my observation in climate

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Speaker 1: investing that there were no venture capitalists that deeply understand

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Speaker 1: government and regulatory risk, despite the fact that the government's

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Speaker 1: playing this central casting role in the energy transition. And

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Speaker 1: so I thought this might be a pathway to heaven

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Speaker 1: for us, observing Tusk Ventures in New York doing this

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Speaker 1: quite successfully for coinbase and draft Kings and Uber. I

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Speaker 1: just don't really care about sports betting, but I really

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Speaker 1: thought that I could add value to these startups as

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Speaker 1: a venture capitalist that deeply understood government, and so that

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Speaker 1: was my path to heaven.

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Speaker 2: So you grow up in Chicago, you moved to DC

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Speaker 2: after college. Was it for a political campaign or was

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Speaker 2: it just a coincidence? Hey, this local business seems pretty

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Speaker 2: pretty fascinating.

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Speaker 1: No, explicitly for campaigns, and so, you know, moved around

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Speaker 1: zip codes in a lot of sort of post industrial

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Speaker 1: wasteland places. I lived in Baltimore working for Martin O'Malley's

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Speaker 1: first governor's race. I lived in Rhode Island working for

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Speaker 1: a Senate race, and then in two thousand and seven

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Speaker 1: got recruited into Obama and that's when I moved to DC.

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Speaker 2: Huh, so your campaign staff during Obama's re election campaign?

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Speaker 2: What were you doing with the Biden administration when they

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Speaker 2: were running in twenty sixteen.

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Speaker 1: I built an impact venture fund that you referenced called

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Speaker 1: Higher Ground Labs. It was our others that you know,

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Speaker 1: Trump had benefited from a lot of new technology, and

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Speaker 1: Democrats were still campaigning with number two pencils and spreadsheets.

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Speaker 2: Now, let me ask you. That's I'm gonna interrupt you

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Speaker 2: right there, because I very vividly recall reading a Wired

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Speaker 2: piece from Wired magazine about how cutting edge the Obama

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Speaker 2: campaign was with iterative changes and a B testing and

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Speaker 2: they just were raising more money, faster for more people.

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Speaker 2: You're telling me by twenty sixteen that's already out of

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Speaker 2: date and fallen way behind.

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Speaker 1: You're exactly right, it's exactly the insight that actually led

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Speaker 1: us to start Higher Ground Labs. Campaigns are like big

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Speaker 1: startups and you raise a billion dollars, as was the

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Speaker 1: case with Obama, you build cutting edge technology, and after

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Speaker 1: election day, the lights go off, everybody leaves, the email

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Speaker 1: addresses go off, and you start anew in four years.

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Speaker 1: As though none of that mattered, and there was no longitudinal,

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Speaker 1: inherent inheritance of learnings and data and technology. And so

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Speaker 1: we wanted to build for profits startups that could build

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Speaker 1: longitudinally compounding innovation and standing as free standing entities that

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Speaker 1: could be even profitable for investors so that we could

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Speaker 1: raise more capital for them. And so we did that.

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Speaker 1: We built companies like Mobilized, which ended up shifting all

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Speaker 1: of the volunteer action in the Democratic Party, sold to

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Speaker 1: an Insight backed the private equity fund insights backed company,

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Speaker 1: and so things like that can both compound returns for

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Speaker 1: investors but also compound innovation to the party, so you

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Speaker 1: don't have to start from zero every four years.

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Speaker 2: So on your LinkedIn, I see you got an NBA

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Speaker 2: from Wharton around the same time as the election. Please

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Speaker 2: don't tell me you would do both at once.

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Speaker 1: I did both. It is not recommended. It was a

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Speaker 1: lot of pounds and gray hair. But you know, my

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Speaker 1: deal with my dad, who came to this country with

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Speaker 1: you know, a big dream, came his country about two

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Speaker 1: hundred bucks in his pocket. He worked as a security

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Speaker 1: guard at Harvard Business Schools and attended Harvard Business School

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Speaker 1: at the same time. You know, there's that line Obama

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Speaker 1: has that every son wants to be live up to

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Speaker 1: his father's expectations or to be something as father is not.

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Speaker 1: It definitely fell in the first category. And so my

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Speaker 1: dad would always point out, like, look, I came to

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Speaker 1: this country with two hundred bucks, and he ultimately became

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Speaker 1: the president of the United Airlines and it was like

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Speaker 1: an incredible career.

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Speaker 2: And so your dad was president of the United Airlines.

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Speaker 2: He was as an immigrant who arrived essentially with a

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Speaker 2: handful of monops.

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Speaker 1: With working as a security guard at night at HBS,

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Speaker 1: and so you know, those were big shoes to fill.

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Speaker 1: And the thing that I always took away from him

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Speaker 1: was that, look, the thing that inspired him about building

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Speaker 1: big businesses and running them was not power. It was

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Speaker 1: not money, though the money is nice. It's the ability

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Speaker 1: to just help so many people he said, like his

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Speaker 1: heroes were always people that could provide a lot of jobs,

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Speaker 1: businessmen and businesswomen that can provide jobs. And so it

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Speaker 1: was that narrative that was always in my head and

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Speaker 1: the need to sort of live up to his big

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Speaker 1: expectations at something to business school.

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Speaker 2: Huh really really interesting? So what'd you study at Wharton?

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Speaker 2: And is any of that appleable to what you do now?

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Speaker 1: You know, thankfully there was no great disclosure at Wharton.

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Speaker 1: I can't tell you very much of what I don't

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Speaker 1: think any NBA can really tell you what they learned.

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Speaker 1: But what I took away from it was an amazing

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Speaker 1: network in some signaling value to say, hey, maybe this

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Speaker 1: guy has half a brain for business, which I'm not

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Speaker 1: even sure is true today.

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Speaker 2: Really really interesting. So you have a quote I really like.

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Speaker 2: You said you felt much closer to Governor Martin O'Malley

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Speaker 2: than he felt towards me. Isn't that true? How it

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Speaker 2: is in all campaigns everybody is looking and sponsoring and

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Speaker 2: loving the candidate, but they have to distribuliviate their affection

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Speaker 2: to millions of supporters.

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Speaker 1: Yeah, you know, there's there's a right and wrong reason

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Speaker 1: to get involved in politics. One of the wrong reasons

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Speaker 1: I think that a lot of people end up doing

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Speaker 1: is that it's a pathway to being closer to power.

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Speaker 1: And I observed it, you know, probably succumbed to some

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Speaker 1: of it myself. But it's the wrong reason to be

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Speaker 1: doing the work. And so I was, you know, kind

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Speaker 1: of making fun of myself for that, but yeah, you're right.

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Speaker 1: You know, these campaigns, you end up liking a lot

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Speaker 1: of hours with these folks. You know, I was. I

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Speaker 1: was Obama's call time manager and fundraiser.

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Speaker 2: You're again, you're anticipating my next question. How much time

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Speaker 2: time did you spend with Obama? And did you not

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Speaker 2: feel the love reciprocated or because he seems to be

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Speaker 2: kind of an unusual guy in politics.

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Speaker 1: A little more removed, a little more ascetic and monkish.

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Speaker 1: You know, yeah, I think he tried to fire me

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Speaker 1: a few times for being too aggressive in fundraising from

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Speaker 1: his friends.

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Speaker 2: But oh really, I'll just say, you know, wait, you were,

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Speaker 2: you were? Obama said, Hey, that dutt a guy. Can

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Speaker 2: we lose him?

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Speaker 1: This guy at least at least twice. Though, My favorite

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Speaker 1: moment was in the Dungeons of two thousand and seven

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Speaker 1: when you know, doldrums of two thousand and seven. We

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Speaker 1: were forty points down to Hillary Clinton and I was

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Speaker 1: still producing multimillion dollar fund raising outcomes for him. And

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Speaker 1: so one time we dropped him off at the you know,

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Speaker 1: he'd start event saying, who do I have to apologize

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Speaker 1: to in here for you, Shamik, and I'd be like

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Speaker 1: that guy, that guy, that guy. So we dropped him

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Speaker 1: back at his apartment and he doubled back to the

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Speaker 1: car and he said, Shimik, keep doing what you're doing.

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Speaker 1: I'll keep apologizing. It's worth it. And it was like

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Speaker 1: the highlight of my career.

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Speaker 2: Is that your Obama is that as good as a guest?

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Speaker 2: WHOA how are you? I can't help but notice that

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Speaker 2: President Obama was probably the first president to take a

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Speaker 2: very strong stance on climate change. How much of your

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Speaker 2: work with the Obama campaign inspired you to start investing

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Speaker 2: in the space.

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Speaker 1: I think the experience from the Obama world was that everybody,

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Speaker 1: you know, there's this big, great Bill Gates line, that

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Speaker 1: everybody underestimates what they can do in ten years and

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Speaker 1: overestimates what they can do in one year, and taking

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Speaker 1: a long term path to doing something really big and

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Speaker 1: grinding on it for a long time can produce extraordinary outcomes.

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Speaker 1: You know, the president was the architect of the Paris Accords,

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Speaker 1: which is the framework that the IPCC now uses to

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Speaker 1: ensure that the world is driving to a net zero future,

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Speaker 1: and so there is a you know, the sparkle I

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Speaker 1: take away from the Obama days was a challenge from him,

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Speaker 1: which is that we should do big things, and if

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Speaker 1: you focus and execute every day for a long period

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Speaker 1: of time, most people probably underestimate what they can accomplish.

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Speaker 2: So we just kind of wrapped up the Climate Accords.

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Speaker 2: Surprisingly in the Middle East, sponsored by a big oil

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Speaker 2: producing nation. How do you look at those events? Are

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Speaker 2: these just photo ops or does something substantial come out

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Speaker 2: of them?

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Speaker 1: I think there was a great deal of heart palpitation

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Speaker 1: about this COP in part because, as you correctly note,

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Speaker 1: the head of the largest oil and gas company in

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Speaker 1: Abu Dhabi was the same man in charge of the COP.

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Speaker 1: And yet all one hundred and eighty countries left with

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Speaker 1: a firm commitment to decarbonize and to transition away from

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Speaker 1: fossil fuels and oil and gas, with an emphatic agreement

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Speaker 1: around that big daring idea that's the first time this

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Speaker 1: has ever come out of a cop and I think

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Speaker 1: the US government's leadership in this, particularly on methane, is

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Speaker 1: going to start reverberating through the market in a really

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Speaker 1: positive way.

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Speaker 2: So I've been reading a bunch of stuff on mething lately.

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Speaker 2: Not only is it a notorious noxious waste that contribute

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Speaker 2: to the greenhouse effect and all sorts of other issues.

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Speaker 2: We just burn off tons of it in flares. Another thing.

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Speaker 2: Not too long ago, Sixty Minutes had a episode where

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Speaker 2: they showed a company was essentially capturing that flare, using

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Speaker 2: it to generate electrical power and running data service centers

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Speaker 2: right there on the oil field.

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Speaker 1: Called Crusoe Energy. I'm actually an investor in that company.

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Speaker 2: Tell us a little bit about that.

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Speaker 1: That's quite fascinating, you know, the two the twin problems.

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Speaker 1: We're going to realize in the near future that we'll

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Speaker 1: have these stranded energy assets that are often leaking methane.

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Speaker 1: We have oil and gas wells that have sustained casing

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Speaker 1: pressure that are bubbling methane. We need to seal those

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Speaker 1: wells permanently or make use of the methane because the

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Speaker 1: methane has a great deal of economic value. The second

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Speaker 1: challenge we have is that our next generation compute is

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Speaker 1: going to be incredibly electricity intensive, far more than what

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Speaker 1: we experienced today, and so data centers are going to

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Speaker 1: become opex pain points for a lot of companies. And

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Speaker 1: what CRUSO wants to do is resolve those two challenges.

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Speaker 1: Take strained energy assets, utilize that energy creatively, and also

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Speaker 1: ensure that we can decarbonize data centers, which are increasingly

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Speaker 1: a large pain point in emissions. There's another company to

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Speaker 1: mention we invested in recently called bio Squeeze, which has

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Speaker 1: invented a new way of permanently sealing oil and gas wells.

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Speaker 1: Some of these operators, like Halliburton, are spending millions of

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Speaker 1: dollars sealing and resealing oil and gas wells with no success.

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Speaker 1: And so these guys have invented a biomineralization technology that

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Speaker 1: is stronger than cement, that can shoot into these wells

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Speaker 1: and permanently seal them, which may one day even replace

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Speaker 1: cement in all infrastructure one day, is what we hope.

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Speaker 1: There's some exciting things happening around methane.

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Speaker 2: So this year's cop Conference of Parties about Climate change

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Speaker 2: ends up with governments making a number of commitments and

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Speaker 2: a lot of nonprofits joining in in those commitments to

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Speaker 2: get towards a carbon neutral But it kind of raises

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Speaker 2: the question is that as effective as what you do

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Speaker 2: in entire terms of venture capital and startups that are

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Speaker 2: looking to in the private sector combat climate change for profit.

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Speaker 1: It's all required. Every single aspect of society will be

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Speaker 1: impacted by climate change, and so every single aspect of

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Speaker 1: society has something to contribute, and every asset class of capital,

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Speaker 1: from private equity to growth to debt, will have to

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Speaker 1: play a role. The reason governments are so centrally important

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Speaker 1: is that it's not enough for us to look at

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Speaker 1: business pain points caused by climate of which there are many,

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Speaker 1: by the way, supply chain disruption, extreme weather events. But

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Speaker 1: you also need to start creating sticks at the same

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Speaker 1: time to push fossil fuels off a cliff. And so

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Speaker 1: I'm encouraged by the fact, for example, that internal combustion

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Speaker 1: engine vehicles will be banned all together in the state

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Speaker 1: of California in ten years. Similarly, France has banned all

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Speaker 1: internal combustion flights within its own borders in the next

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Speaker 1: ten years, and so these sticks are also important to

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Speaker 1: intersect with the care that help new technologies mature fast

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Speaker 1: enough to replace them, and there will be a fundamental

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Speaker 1: rewiring of the economy that takes place as a result.

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Speaker 1: When you think of every single aspect of industry, steel making,

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Speaker 1: fertilizer that you know, ten trillion dollars of ebidel will

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Speaker 1: be at stake in this turnover, and so there's an

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Speaker 1: enormous prize for those that can innovate quickly and help decarbonize.

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Speaker 2: You mentioned the company that seals up well heads. Bloomberg

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Speaker 2: had an article not too long ago about what a

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Speaker 2: massive carbon footprint concrete manufacturing has. Tell us a little

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Speaker 2: bit about that technology that theoretically you might replace concrete

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Speaker 2: in the future.

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Speaker 1: You know, one of the central insights here is that

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Speaker 1: industrial heat is the key input to manufacturing just about anything.

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Speaker 1: If you think about steel making from iron, if you

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Speaker 1: think about concrete, if you think about a lot of

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Speaker 1: food and ethanol methanol production, all of it requires in

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Speaker 1: the United States alone, one hundred and forty billion dollars

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Speaker 1: worth of industrial heat, almost all of which comes from

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Speaker 1: natural gas or coal. And to get really high temperatures

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Speaker 1: from that heat, is sometimes difficult, and so there are

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Speaker 1: breakthrough technologies. We're excited about one called Antra in particular,

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Speaker 1: financed by Bill Gates and Chris Sokka and by Overture,

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Speaker 1: and these three Stanford PhDs have figured out a way

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Speaker 1: to take grid connected renewable electricity and produce industrial heat

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Speaker 1: above eighteen hundred degrees celsius. And when you think about

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Speaker 1: the hardest to decarbonize industries, you know, about ninety five

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Speaker 1: percent of all industrial manufacturing can be decarbonized with that

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Speaker 1: kind of heat. And what's amazing about this company is

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Speaker 1: they're not going you know, it's called the mister Burns test.

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Speaker 1: I can go to a conglomerate who does not care

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Speaker 1: a lick about climate change and convince them that I

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Speaker 1: can save them opex with this decarbonized solution. It has

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Speaker 1: nothing to do with climate change in their minds, and.

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Speaker 2: They just still want investment of money saving opportunity for

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Speaker 2: companies in the space.

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Speaker 1: So the coke industries is behind this company has taken

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Speaker 1: them to a lot of their conglomerates and it's a

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Speaker 1: really exciting technology because it is just beating natural gas

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Speaker 1: at its own game. And that is you know, a

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Speaker 1: theory of change for us is that if you can

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Speaker 1: beat natural gas at its own game and save conglomerates

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Speaker 1: and big businesses money, they will adopt your technologies. It

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Speaker 1: becomes more challenging when you're bringing them green premiums and

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Speaker 1: things that are a little more expensive.

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Speaker 2: So correct my ignorance, if you will. I look at

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Speaker 2: natural gas as a transitional energy source from oil and

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Speaker 2: coal to ultimately renewables. Tell me where that thesis is wrong.

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Speaker 1: It was correct. It was absolutely a better source of

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Speaker 1: fuel than coal, which you know produces black suit and

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Speaker 1: all kinds of problems and diesel.

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Speaker 2: Now the what about clean coal? The case face.

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Speaker 1: The key is to now transition from natural gas. You know,

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Speaker 1: natural gas is a is a nice word for methane.

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Speaker 1: It's primarily methane, and methane is about eighty times more

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Speaker 1: warming than carbon dioxide. And so if carbon dioxide is

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Speaker 1: one blanket thick to keep the earth warm, you can

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Speaker 1: think of Lebron James height blanket to trap the molecule

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Speaker 1: traps far more heat and doesn't allow our sunlight to

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Speaker 1: radiate back to outer space as it should. And so

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Speaker 1: the key now is that renewables have this extensive runway

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Speaker 1: since we thought of natural gas as a bridge fuel,

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Speaker 1: And candidly, the lowest costs of energy today are solar

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Speaker 1: and wind, and so businesses can make rational decisions to

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Speaker 1: adopt them. And the key is to now sort of

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Speaker 1: transition us off this sticky drug that we've been addicted

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Speaker 1: to for some time.

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Speaker 2: That wasn't true a couple of years ago. Renewable energies

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Speaker 2: like solar and wind were pricier than natural gas and oil. Today,

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Speaker 2: the price of solar and wind just keeps falling and falling.

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Speaker 2: Is it accurate to say on a per kilowatt basis

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Speaker 2: they are now cheaper than carbon based fuel.

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Speaker 1: They are absolutely the cheapest forms of electricity available in

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Speaker 1: most places in the world today. A staggering statistic. The

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Speaker 1: capex of a new solar plant is today cheaper than

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Speaker 1: the opex the annual opex of a coal plant real

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Speaker 1: and so these things, you know, the human mind is

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Speaker 1: some sometimes bad at tracking exponential change. The logarithmic drop

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Speaker 1: in solar and wind prices continually surprises even the most

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Speaker 1: bullish analysts. And I think the same is now coming

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Speaker 1: true for lithium ion and a lot of these other

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Speaker 1: technologies and so we are dropping down these logarithmic cost curves.

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Speaker 1: And what's interesting is I think there's a geopolitical reality

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Speaker 1: today in a global contest for power with China, the

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Speaker 1: countries that are able to have the lowest cost of

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Speaker 1: plentiful energy that does not require any kind of foreign inputs,

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Speaker 1: that has a domestic supply chain underneath it, that can

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Speaker 1: produce that energy on their own, that will be one

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Speaker 1: of the key key drivers to global heged demonic success

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Speaker 1: in this new world, coupled with next generation compute that's

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Speaker 1: also within our own supply chain. And so the last

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Speaker 1: time we saw a great power struggle like this was

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Speaker 1: in the semiconductor boom, where where Faild, Fairchild, semiconductors, Intel

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Speaker 1: Texas instruments were built. Those were not like the bits

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Speaker 1: that are traded in software today. Those were atoms. It

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Speaker 1: was hardware investing that governments were deeply involved in. So

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Speaker 1: the fifty percent of the revenue of Fairchild in the

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Speaker 1: early days came from the Pentagon. Similarly, TSMC when it

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Speaker 1: was built, fifty percent of that CAPEX was handled by Taiwan,

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Speaker 1: And when Samsung went into semiconductors, the same proof true

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Speaker 1: of the South Korean government. The same is going to

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Speaker 1: be true of climate investing today. A lot of the

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Speaker 1: innovative hardware must be built today and that will require

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Speaker 1: intense government involvement. And that's why overtures thesis is that

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Speaker 1: investors that deeply understand and can navigate government and regulatory

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Speaker 1: complexity can actually produce alpha for their investors. Because it's

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Speaker 1: a bit like in World War Two, if you knew

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Speaker 1: what the US government needed, if they were going to

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Speaker 1: need to pay betting manufacturers to make parachutes, you know,

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Speaker 1: that's an important insight to be able to drive the

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Speaker 1: best investments through.

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Speaker 2: Really really very interesting. So let's talk a little bit

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Speaker 2: about what you look for in a climate investment. Is

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Speaker 2: this about looking for companies that are going to be

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Speaker 2: casual and positive right away or are you willing to

438
00:22:14,800 --> 00:22:17,320
Speaker 2: be a little more long term in your thinking?

439
00:22:18,000 --> 00:22:20,640
Speaker 1: Venture capital is an incredibly patient game, right on average

440
00:22:20,720 --> 00:22:23,480
Speaker 1: ten to twelve year positions you're taking, as we saw

441
00:22:23,480 --> 00:22:25,760
Speaker 1: with Union Score Ventures is first fund. I think it

442
00:22:25,800 --> 00:22:28,600
Speaker 1: took them almost sixteen years from start to finish.

443
00:22:28,680 --> 00:22:31,080
Speaker 2: So it's an incredibly that worked out pretty well, didn't.

444
00:22:30,840 --> 00:22:34,359
Speaker 1: Worked out great. It's an incredibly patient, deeply liquid game.

445
00:22:34,880 --> 00:22:37,199
Speaker 1: But you know, to radically oversimplify what we look for.

446
00:22:37,359 --> 00:22:41,320
Speaker 1: We're looking for visionary, unbelievable founders. Founders are the soul

447
00:22:41,800 --> 00:22:46,080
Speaker 1: of startups, and we're looking for unbelievable founders with deep

448
00:22:46,160 --> 00:22:51,760
Speaker 1: expertise in what they're building, coupled with differentiated technology that

449
00:22:51,840 --> 00:22:55,119
Speaker 1: can help unlock gigantic markets. And so to give you

450
00:22:55,160 --> 00:22:58,600
Speaker 1: a couple of examples, we're investors in a company called Dextmat,

451
00:22:59,000 --> 00:23:03,200
Speaker 1: which has invented a carbon nanotube technology that is stronger

452
00:23:03,200 --> 00:23:06,880
Speaker 1: than steel, lighter than aluminum, and more conductive than copper.

453
00:23:07,359 --> 00:23:09,640
Speaker 1: Copper is going to be one of the most important

454
00:23:09,640 --> 00:23:12,800
Speaker 1: metals in all of electrification. Aluminum is in every aircraft

455
00:23:12,800 --> 00:23:16,480
Speaker 1: and every airplane, a lot of phone poles and wires,

456
00:23:16,760 --> 00:23:21,159
Speaker 1: and steel is steel. This technology might fully decarbonize in

457
00:23:21,160 --> 00:23:25,119
Speaker 1: a carbon negative way a metal that is stronger, more conductive,

458
00:23:25,200 --> 00:23:29,040
Speaker 1: and lighter. And so those are our moonshot examples of

459
00:23:29,080 --> 00:23:31,159
Speaker 1: what we're looking for, and that require a lot of

460
00:23:31,200 --> 00:23:34,119
Speaker 1: technological and go to market innovation to be successful. But

461
00:23:34,200 --> 00:23:36,800
Speaker 1: if they are, I think there are trillion dollar rewards

462
00:23:36,800 --> 00:23:37,520
Speaker 1: on the other side.

463
00:23:37,680 --> 00:23:42,160
Speaker 2: So you're looking to replace the skin of aircraft, perhaps

464
00:23:42,240 --> 00:23:47,640
Speaker 2: the body of automobiles, the wires on interstate or local

465
00:23:48,480 --> 00:23:54,440
Speaker 2: electronic transmission, electricity transmission, and even things like telephone wires

466
00:23:54,520 --> 00:23:58,240
Speaker 2: and internet wires or is it am I overstating that

467
00:23:58,240 --> 00:23:58,640
Speaker 2: that's right?

468
00:23:58,680 --> 00:24:02,520
Speaker 1: And the company today is, you know, the production of

469
00:24:02,600 --> 00:24:06,960
Speaker 1: their of their metal is so expensive that only ultra

470
00:24:07,000 --> 00:24:12,520
Speaker 1: advanced defense manufacturers and companies testing R and D can

471
00:24:12,560 --> 00:24:14,880
Speaker 1: afford it. The bet is that they can drive down

472
00:24:14,920 --> 00:24:17,520
Speaker 1: the cost by one thousand, you know, one one thousandth

473
00:24:17,880 --> 00:24:20,879
Speaker 1: the cost over time and produce something that is just

474
00:24:21,040 --> 00:24:24,600
Speaker 1: better than the industrial inputs that have very carbon intensive

475
00:24:24,600 --> 00:24:27,239
Speaker 1: emissions footprints, as we've mentioned before. And so if you're

476
00:24:27,240 --> 00:24:30,119
Speaker 1: an aircraft and can find something lighter than aluminium that

477
00:24:30,160 --> 00:24:33,800
Speaker 1: can help your aircraft travel farther, that's a money saver

478
00:24:33,920 --> 00:24:34,480
Speaker 1: for the company.

479
00:24:34,520 --> 00:24:38,359
Speaker 2: And so those does material science have the equivalent of

480
00:24:38,400 --> 00:24:39,240
Speaker 2: a Moore's law.

481
00:24:40,080 --> 00:24:44,240
Speaker 1: It does, And interestingly a lot of the materials today

482
00:24:44,440 --> 00:24:48,959
Speaker 1: are reaching that high point. Right at some point, semiconductors

483
00:24:49,040 --> 00:24:51,879
Speaker 1: are reaching the theoretical limits of how many transistors you can

484
00:24:51,880 --> 00:24:54,920
Speaker 1: wedge in. And so that's why innovating with ferro electric

485
00:24:55,040 --> 00:24:58,520
Speaker 1: materials and using AI to be able to optimize all

486
00:24:58,560 --> 00:25:00,880
Speaker 1: of the dizzing different kind of material combinations we can

487
00:25:00,920 --> 00:25:03,320
Speaker 1: consider is what we need to do for this next

488
00:25:03,400 --> 00:25:06,400
Speaker 1: layer of industrial revolution. So when you consider just the

489
00:25:06,440 --> 00:25:10,960
Speaker 1: ten trillion in ebidah, start considering every manufacturing process today

490
00:25:11,000 --> 00:25:14,160
Speaker 1: as we do it, every food production process, the way

491
00:25:14,200 --> 00:25:17,280
Speaker 1: we move ourselves with transportation, the way we grow food

492
00:25:17,280 --> 00:25:20,000
Speaker 1: in agriculture, all of this is going to have to

493
00:25:20,040 --> 00:25:22,639
Speaker 1: reorient in about fifty years. If you believe the science

494
00:25:23,040 --> 00:25:27,000
Speaker 1: and old conglomerates, large scale conglomerates aren't usually not the

495
00:25:27,000 --> 00:25:30,040
Speaker 1: places that drive innovation, and that's what makes venture such

496
00:25:30,080 --> 00:25:32,480
Speaker 1: an interesting catalytic. A SI class to me in climate.

497
00:25:32,800 --> 00:25:34,879
Speaker 1: I am not doing this out of the goodness of

498
00:25:34,920 --> 00:25:37,119
Speaker 1: my heart. I candidly kind of missed the Internet. I

499
00:25:37,160 --> 00:25:39,439
Speaker 1: was so involved in politics. And if you consider some

500
00:25:39,480 --> 00:25:44,640
Speaker 1: of the megacycles software eating the world, China opening up

501
00:25:44,920 --> 00:25:47,200
Speaker 1: ultra low cost interest rates, I think this is another

502
00:25:47,560 --> 00:25:50,200
Speaker 1: megacycle coming and I don't want to miss it. And

503
00:25:50,520 --> 00:25:52,960
Speaker 1: like all megacycles, being early is the same as being wrong.

504
00:25:53,080 --> 00:25:55,680
Speaker 1: And so a lot of our job is timing our

505
00:25:55,720 --> 00:25:59,000
Speaker 1: bets to make sure where can technoeconomics just beat fossil

506
00:25:59,000 --> 00:26:01,200
Speaker 1: fuels invest behind that right now?

507
00:26:01,280 --> 00:26:04,919
Speaker 2: So let's talk about some of those different spaces. I

508
00:26:04,960 --> 00:26:07,240
Speaker 2: want to throw out some broad topics. You tell me

509
00:26:07,800 --> 00:26:10,680
Speaker 2: what you think about those and what sort of investments

510
00:26:10,760 --> 00:26:14,160
Speaker 2: you would be looking at or have already made in those.

511
00:26:14,840 --> 00:26:18,679
Speaker 2: And let's start with carbon capture. You know, some people

512
00:26:18,680 --> 00:26:22,840
Speaker 2: have said we can solve climate change by just taking

513
00:26:22,880 --> 00:26:26,679
Speaker 2: all this excess carbon that's in the air. What do

514
00:26:26,680 --> 00:26:28,320
Speaker 2: you think about carbon capture?

515
00:26:28,880 --> 00:26:32,640
Speaker 1: I think if you believe the science, the IPCC has

516
00:26:32,680 --> 00:26:36,760
Speaker 1: stated we're going to need to remove ten billion tons

517
00:26:36,880 --> 00:26:40,439
Speaker 1: of carbon every year by the year twenty fifty. And

518
00:26:40,520 --> 00:26:41,919
Speaker 1: if you look at what we did last year, we

519
00:26:41,920 --> 00:26:44,440
Speaker 1: did about six thousand tons. So there's a two million

520
00:26:44,600 --> 00:26:46,879
Speaker 1: x scale up that has to happen, or a seventy

521
00:26:46,880 --> 00:26:49,360
Speaker 1: four percent cager, which is twice the growth of software.

522
00:26:49,640 --> 00:26:52,359
Speaker 1: So there's an enormous undertaking. The question for us is

523
00:26:52,960 --> 00:26:56,640
Speaker 1: what is the lowest cost, most scalable, more most efficient

524
00:26:56,760 --> 00:27:00,320
Speaker 1: version of this. Direct air capture today still pencils around

525
00:27:00,359 --> 00:27:04,800
Speaker 1: sixteen hundred dollars per ton, enormously electricity intensive. We have

526
00:27:04,920 --> 00:27:07,760
Speaker 1: drifted a little bit more towards two categories. The first

527
00:27:07,800 --> 00:27:10,440
Speaker 1: is enhanced rock weathering. We're investors in a company called

528
00:27:10,520 --> 00:27:14,719
Speaker 1: ion that has pulverized a certain silicate rock called olivine

529
00:27:14,920 --> 00:27:18,800
Speaker 1: that can help basically grow more crops for farmers. They're

530
00:27:18,920 --> 00:27:21,879
Speaker 1: very familiar with it. It's basically a form of fertilizer,

531
00:27:22,040 --> 00:27:25,240
Speaker 1: while it also sucks carbon out of the atmosphere permanently.

532
00:27:25,640 --> 00:27:28,240
Speaker 1: Very excited about technologies like that. We're also investors in

533
00:27:28,280 --> 00:27:31,640
Speaker 1: a company called Climate Robotics that is similarly taking agricultural

534
00:27:31,680 --> 00:27:34,480
Speaker 1: waste and pyalizing it, basically cooking it in an oxygen

535
00:27:34,520 --> 00:27:37,800
Speaker 1: free environment and producing something called biochar, which is an

536
00:27:37,880 --> 00:27:42,080
Speaker 1: excellent soil amendment. It helps crops grow more, Farmers crave biochar,

537
00:27:42,359 --> 00:27:45,280
Speaker 1: but it also sequesters carbon for at least a thousand

538
00:27:45,320 --> 00:27:47,240
Speaker 1: years according to a new white paper. And so we're

539
00:27:47,280 --> 00:27:49,440
Speaker 1: really excited about companies and technologies like this.

540
00:27:49,640 --> 00:27:53,040
Speaker 2: Huh, really interesting. What about just straight up energy production?

541
00:27:53,600 --> 00:27:59,600
Speaker 2: It seems like it's been mostly incremental improvements in the

542
00:27:59,760 --> 00:28:05,000
Speaker 2: cost of solar and winds, but not so much the productivity.

543
00:28:04,760 --> 00:28:09,360
Speaker 2: They've also been very very gradual. Do we need an

544
00:28:09,520 --> 00:28:14,239
Speaker 2: order of magnitude improvement in the production of energy or

545
00:28:14,320 --> 00:28:16,280
Speaker 2: is it just something we're going to grind away at

546
00:28:16,320 --> 00:28:17,600
Speaker 2: for decades at a time.

547
00:28:17,800 --> 00:28:21,000
Speaker 1: We need a paradigm shift and energy production. You know,

548
00:28:21,040 --> 00:28:23,600
Speaker 1: if you're gonna electrify everything, think for a moment about

549
00:28:24,040 --> 00:28:28,040
Speaker 1: electrifying every form of vehicle transportation. You're not gonna have

550
00:28:28,080 --> 00:28:30,159
Speaker 1: gas stations anymore. You're gonna have to charge them. And

551
00:28:30,200 --> 00:28:32,680
Speaker 1: so that estimates are that the United States is gonna

552
00:28:32,720 --> 00:28:35,960
Speaker 1: have to triple its energy product, its electricity production, and

553
00:28:36,080 --> 00:28:39,680
Speaker 1: its borders alone over the next fifteen to twenty five years.

554
00:28:39,680 --> 00:28:42,640
Speaker 1: An enormous undertaking. Right this we're talking about trillion dollar

555
00:28:43,120 --> 00:28:46,480
Speaker 1: capex required to be able to reinvent the grid. And

556
00:28:46,600 --> 00:28:48,520
Speaker 1: at the heart of this is where can you dry

557
00:28:49,160 --> 00:28:51,920
Speaker 1: drive the lowest cost electricity and have it to be

558
00:28:52,040 --> 00:28:55,840
Speaker 1: available plentifully and infirm power twenty four to seven and

559
00:28:55,920 --> 00:28:58,400
Speaker 1: so storage and I think batteries will be there.

560
00:28:58,400 --> 00:29:01,200
Speaker 2: That's my next question is, you know, I don't believe

561
00:29:01,200 --> 00:29:04,600
Speaker 2: lithium ee on is the end game in battery storage.

562
00:29:04,840 --> 00:29:07,520
Speaker 2: They're just too big and too heavy and they have

563
00:29:07,600 --> 00:29:11,680
Speaker 2: a fairly short life cycle. What's the next phase in

564
00:29:11,800 --> 00:29:14,480
Speaker 2: batteries that are going to be lighter, are going to

565
00:29:14,600 --> 00:29:18,640
Speaker 2: improve range, allow you to use smaller batteries, and aren't

566
00:29:18,720 --> 00:29:23,800
Speaker 2: gonna start dying after a thousand full charges and discharges,

567
00:29:24,200 --> 00:29:26,560
Speaker 2: but have a lifespan of ten thousand or one hundred

568
00:29:26,560 --> 00:29:27,400
Speaker 2: thousand charges.

569
00:29:27,720 --> 00:29:30,680
Speaker 1: You know, there are a lot of interesting things happening

570
00:29:30,760 --> 00:29:32,920
Speaker 1: in fusion right now that we're tracking. We have not

571
00:29:32,960 --> 00:29:36,480
Speaker 1: made an investment, but I think the rate of exponential

572
00:29:36,480 --> 00:29:39,840
Speaker 1: improvement and possibility in fusion is coming much faster than

573
00:29:39,840 --> 00:29:40,760
Speaker 1: people realize.

574
00:29:40,960 --> 00:29:43,440
Speaker 2: And in the nuclear fusion like what drives the sun

575
00:29:43,520 --> 00:29:45,560
Speaker 2: and stars at the universe.

576
00:29:45,640 --> 00:29:49,840
Speaker 1: Correct, So commonwealth fusion companies like Avalanches, which are in

577
00:29:49,840 --> 00:29:53,080
Speaker 1: the lower carbon portfolio, incredibly exciting. In the interim, there's

578
00:29:53,200 --> 00:29:56,400
Speaker 1: interesting innovation for grid scale storage coming from companies like

579
00:29:56,440 --> 00:29:59,600
Speaker 1: form Energy and hopefully and Torah in our portfolio is

580
00:29:59,600 --> 00:30:02,320
Speaker 1: also going to to provide a huge storage buffer. And so,

581
00:30:02,360 --> 00:30:05,200
Speaker 1: as you correctly note, lithium ion is ill suited for

582
00:30:05,280 --> 00:30:07,760
Speaker 1: long duration storage, right for forty six hours, If you

583
00:30:07,760 --> 00:30:10,160
Speaker 1: need to slam something quickly, it's perfect. And so we

584
00:30:10,200 --> 00:30:13,440
Speaker 1: think lithium ion will continue to power most electric vehicles,

585
00:30:13,680 --> 00:30:17,440
Speaker 1: electric aircraft, but for grid scale, long duration storage, you're

586
00:30:17,440 --> 00:30:19,680
Speaker 1: going to require innovation, and that innovation is going to

587
00:30:19,760 --> 00:30:22,240
Speaker 1: have hundreds of billions of dollars of reward waiting. On

588
00:30:22,280 --> 00:30:22,959
Speaker 1: the other side of it.

589
00:30:23,200 --> 00:30:27,200
Speaker 2: You mentioned fusion. What about I keep reading about the

590
00:30:27,280 --> 00:30:32,040
Speaker 2: smaller scale traditional fission nuclear plants. We haven't built a

591
00:30:32,080 --> 00:30:36,000
Speaker 2: new nuclear plant in the United States for decades. That

592
00:30:36,240 --> 00:30:38,240
Speaker 2: seems to be changing now there are a few small

593
00:30:38,280 --> 00:30:42,000
Speaker 2: scale plants coming online. How do you look at nuclear?

594
00:30:42,440 --> 00:30:44,520
Speaker 1: You know, I'm a bit of more of a skeptic.

595
00:30:44,600 --> 00:30:46,440
Speaker 1: I think in the tech communities you get a lot

596
00:30:46,480 --> 00:30:48,120
Speaker 1: of folks who roll their eyes and say, just build

597
00:30:48,200 --> 00:30:51,400
Speaker 1: nuclear and you'll be fine. The cost overruns in nuclear

598
00:30:51,440 --> 00:30:54,760
Speaker 1: have been astronomic, and in building the grid scale plants,

599
00:30:54,840 --> 00:30:58,240
Speaker 1: everyone is different. Whereas the South Koreans are stamping out

600
00:30:58,320 --> 00:31:01,480
Speaker 1: units and learning from them increasingly over time, we don't

601
00:31:01,520 --> 00:31:04,760
Speaker 1: have those learnings here and so on average, a nuclear

602
00:31:04,760 --> 00:31:07,080
Speaker 1: plant is taking twenty years to build. Way too, it

603
00:31:07,120 --> 00:31:09,880
Speaker 1: is going three hundred percent over cost, and so I

604
00:31:09,920 --> 00:31:12,920
Speaker 1: am excited about the miniaturized nuclear applications. We're going to

605
00:31:13,000 --> 00:31:15,520
Speaker 1: need a lot of energy to do things like electrolyzed hydrogen,

606
00:31:15,880 --> 00:31:18,760
Speaker 1: and that's going to be incredibly electricity intensive and potentially

607
00:31:18,800 --> 00:31:22,240
Speaker 1: power direct air capture. So I think there's certain use

608
00:31:22,280 --> 00:31:24,360
Speaker 1: cases there, But again to learn that, you have to

609
00:31:24,440 --> 00:31:27,320
Speaker 1: modularize and build a factory method that allows you to

610
00:31:27,360 --> 00:31:30,120
Speaker 1: iterate and improve on your production, not build these one

611
00:31:30,120 --> 00:31:32,520
Speaker 1: off plants that are all looking different, all running out

612
00:31:32,560 --> 00:31:33,760
Speaker 1: of money, all over cost.

613
00:31:33,960 --> 00:31:38,640
Speaker 2: I remember about a decade ago the Great reactor hope

614
00:31:38,640 --> 00:31:42,800
Speaker 2: with thorium kind of fell of the off the front pages.

615
00:31:43,160 --> 00:31:45,640
Speaker 2: What's going on in that space? You know?

616
00:31:45,800 --> 00:31:47,920
Speaker 1: I think a big challenge here is that there's real

617
00:31:48,040 --> 00:31:51,120
Speaker 1: national security issues around building nuclear plants. And if you

618
00:31:51,120 --> 00:31:53,640
Speaker 1: talk to the national security community, you know they're very

619
00:31:53,720 --> 00:31:56,600
Speaker 1: worried about being able to take enriched uranium and build

620
00:31:56,640 --> 00:32:00,000
Speaker 1: dirty bombs out of it. And so if you couple

621
00:32:00,520 --> 00:32:03,120
Speaker 1: the amount of intense regulatory scrutiny out of the nuclear

622
00:32:02,800 --> 00:32:05,800
Speaker 1: regulatory world, which is the most brutal place if you

623
00:32:05,840 --> 00:32:09,920
Speaker 1: want to talk about regulatory risk, national con security considerations,

624
00:32:10,000 --> 00:32:13,080
Speaker 1: costs over runs, time, and a lack of deep specialization

625
00:32:13,160 --> 00:32:16,160
Speaker 1: in this country, I think candidly we're better off investing

626
00:32:16,200 --> 00:32:20,680
Speaker 1: in wind water through hydroelectric power, solar and batteries. Those

627
00:32:20,720 --> 00:32:23,200
Speaker 1: are scaled and ready to be deployed right now. And

628
00:32:23,280 --> 00:32:26,200
Speaker 1: fusion already happens right We're already harnessing the energy of

629
00:32:26,200 --> 00:32:28,840
Speaker 1: the sun in our solar panels. And so I am

630
00:32:29,040 --> 00:32:32,200
Speaker 1: personally more bullish on that as a method of deployment.

631
00:32:32,600 --> 00:32:35,960
Speaker 2: What do you think is the most exciting climate innovation

632
00:32:36,120 --> 00:32:38,320
Speaker 2: that we'll see come out in twenty twenty four.

633
00:32:40,800 --> 00:32:44,040
Speaker 1: I think a lot of the IRA incentives, the inflation

634
00:32:44,080 --> 00:32:47,480
Speaker 1: reduction X incentives, have yet to be realized in the market.

635
00:32:47,720 --> 00:32:51,160
Speaker 1: There's a provision in the IRA called forty five X,

636
00:32:51,680 --> 00:32:53,920
Speaker 1: and what forty five X does is, for the first

637
00:32:53,960 --> 00:32:57,120
Speaker 1: time since World War Two, pays OEMs to make things.

638
00:32:57,160 --> 00:32:59,280
Speaker 1: So back to my betting analogy, if you are a

639
00:32:59,320 --> 00:33:02,240
Speaker 1: betting manufacturer and the government wanted you to make parachutes,

640
00:33:02,480 --> 00:33:04,480
Speaker 1: they would just pay you to make those parachutes before

641
00:33:04,480 --> 00:33:06,840
Speaker 1: they even bought the parachute, and so you were going

642
00:33:06,920 --> 00:33:09,560
Speaker 1: to see a staggering scale of deployment. We're investors in

643
00:33:09,600 --> 00:33:12,560
Speaker 1: a company called Harbinger, which is an electric mid duty truck,

644
00:33:12,880 --> 00:33:15,400
Speaker 1: one of the most important vehicles on the road the

645
00:33:15,440 --> 00:33:18,400
Speaker 1: workhourses that drop off all of our e commerce delivery equipment.

646
00:33:18,760 --> 00:33:21,240
Speaker 1: There is nobody building a good mid duty truck today.

647
00:33:21,480 --> 00:33:24,040
Speaker 1: Harbinger is building a mid duty EV truck that is

648
00:33:24,080 --> 00:33:27,840
Speaker 1: going to beat ice trucks at their own game. Before incentives,

649
00:33:28,280 --> 00:33:30,560
Speaker 1: and when you factor in things like forty five x

650
00:33:30,840 --> 00:33:33,560
Speaker 1: this company Harbinger could have negative cogs. And so when

651
00:33:33,560 --> 00:33:36,160
Speaker 1: you think about what that means for the scale of deployment,

652
00:33:36,360 --> 00:33:39,280
Speaker 1: I would say the big surprise is not a particular technology.

653
00:33:39,280 --> 00:33:40,880
Speaker 1: It's just going to be the speed and scale of

654
00:33:40,920 --> 00:33:43,400
Speaker 1: deployment is going to singd your eyebrows. It's going to

655
00:33:43,400 --> 00:33:45,760
Speaker 1: be incredibly exciting. You know this. We're talking about a

656
00:33:45,800 --> 00:33:48,360
Speaker 1: trillion dollar wall of money coming from the US government

657
00:33:48,360 --> 00:33:50,720
Speaker 1: from the Infliction Reduction Act, the Chips Bill, and the

658
00:33:50,720 --> 00:33:53,680
Speaker 1: Infrastructure Bill to scale the deployment of a lot of

659
00:33:53,680 --> 00:33:57,080
Speaker 1: decarbonized technologies to remake the world as we've described it.

660
00:33:57,080 --> 00:33:58,719
Speaker 1: And so that's what gets me really excited.

661
00:33:58,960 --> 00:34:01,640
Speaker 2: Yeah, that sounds really really interesting. So one of the

662
00:34:01,680 --> 00:34:04,880
Speaker 2: things I wanted to ask you about. You had referenced

663
00:34:05,280 --> 00:34:08,799
Speaker 2: how in a lot of technologies the government is the

664
00:34:08,840 --> 00:34:14,879
Speaker 2: big mover, and we could talk about everything from railroads

665
00:34:14,920 --> 00:34:19,200
Speaker 2: and the telegraph to more recently semiconductors. The one thing

666
00:34:19,239 --> 00:34:24,680
Speaker 2: we didn't mention is how the government essentially has driven

667
00:34:24,719 --> 00:34:28,040
Speaker 2: the creation of the Internet through everything they did with

668
00:34:28,280 --> 00:34:34,600
Speaker 2: DARPA and having a essentially hardened response to a nuclear

669
00:34:34,640 --> 00:34:41,320
Speaker 2: attack is effectively where the Internet came from.

670
00:34:40,080 --> 00:34:43,600
Speaker 1: You know, surprised to learn every single component of the

671
00:34:43,640 --> 00:34:47,280
Speaker 1: iPhone from the touchscreen on down has an origination story

672
00:34:47,360 --> 00:34:48,840
Speaker 1: from US government programs.

673
00:34:49,360 --> 00:34:50,719
Speaker 2: I mean, if you look at what came out of

674
00:34:50,800 --> 00:34:53,720
Speaker 2: the moon landings and NASA, it's everything from the microwave

675
00:34:53,760 --> 00:35:00,239
Speaker 2: oven to arguably tang But I think we underestimate the

676
00:35:00,320 --> 00:35:04,479
Speaker 2: impact of that private public partnership. Tell us a little

677
00:35:04,520 --> 00:35:06,319
Speaker 2: bit about what you see in that space and what

678
00:35:06,320 --> 00:35:08,520
Speaker 2: it's going to mean for climate transition.

679
00:35:08,640 --> 00:35:11,120
Speaker 1: You know, I just watched Oppenheimer with my business partner

680
00:35:11,160 --> 00:35:12,319
Speaker 1: to me, and I don't know if you've seen that.

681
00:35:12,600 --> 00:35:16,560
Speaker 1: Oh fantastic sensational and it's such a terrific example of

682
00:35:16,719 --> 00:35:19,400
Speaker 1: how the US government can do things so much faster

683
00:35:19,800 --> 00:35:22,400
Speaker 1: when it puts its mind to it, and in emergencies,

684
00:35:22,440 --> 00:35:24,480
Speaker 1: and I believe climate change will be an emergency that

685
00:35:24,560 --> 00:35:26,680
Speaker 1: every will affect everybody, and we'll all have to spend

686
00:35:26,719 --> 00:35:30,239
Speaker 1: the rest of our lives solving together. There is no

687
00:35:30,800 --> 00:35:34,120
Speaker 1: entity large enough that can scale innovation quickly enough to

688
00:35:34,200 --> 00:35:36,120
Speaker 1: hit these net zero targets, and that's what makes it

689
00:35:36,160 --> 00:35:38,800
Speaker 1: such an important place. And you know, these national labs

690
00:35:38,800 --> 00:35:42,000
Speaker 1: started their origin from the Manhattan Project and they gave

691
00:35:42,080 --> 00:35:44,920
Speaker 1: us fission right. Ultimately, our nuclear plants came out of

692
00:35:44,920 --> 00:35:47,520
Speaker 1: the Manhattan Project, and it's a good example of what

693
00:35:47,640 --> 00:35:49,640
Speaker 1: happens when you get a lot of buying and a

694
00:35:49,640 --> 00:35:52,279
Speaker 1: lot of focus from government unlock things, which is what

695
00:35:52,520 --> 00:35:54,279
Speaker 1: the period of time we're about to enter right now in.

696
00:35:54,280 --> 00:35:57,400
Speaker 2: Clim So what other technologies do you find interesting? What

697
00:35:58,200 --> 00:35:59,960
Speaker 2: types of companies are you looking at?

698
00:36:00,920 --> 00:36:03,440
Speaker 1: So the heating and cooling of big buildings is a

699
00:36:03,440 --> 00:36:07,239
Speaker 1: place of major focus. The built environment buildings are responsible

700
00:36:07,239 --> 00:36:07,840
Speaker 1: for that.

701
00:36:07,560 --> 00:36:10,840
Speaker 2: That doesn't sound sexy and exigning that sounds like it

702
00:36:10,880 --> 00:36:15,560
Speaker 2: should be basic efficiency and blocking and tackling. But every

703
00:36:15,640 --> 00:36:17,759
Speaker 2: large you know, you look in a city like New

704
00:36:17,840 --> 00:36:22,160
Speaker 2: York or Chicago, it's an immense amount of energy consumption.

705
00:36:21,719 --> 00:36:25,600
Speaker 1: An immense amount of fossil fuel energy, using natural gas,

706
00:36:25,640 --> 00:36:28,440
Speaker 1: still using diesel, still using coal in some cases as

707
00:36:28,480 --> 00:36:31,560
Speaker 1: parts of the world, and yet everybody's urbanizing, we're building

708
00:36:31,600 --> 00:36:34,920
Speaker 1: bigger buildings, and it's becoming an opex headache in some cases.

709
00:36:34,920 --> 00:36:37,319
Speaker 1: And so we're investors in a company called Bedrock that

710
00:36:37,360 --> 00:36:40,200
Speaker 1: I'm excited to announce. This is a technology founded by

711
00:36:40,280 --> 00:36:42,880
Speaker 1: Joscelyn Lai and her co founder Sylview, who is a

712
00:36:42,920 --> 00:36:45,239
Speaker 1: chief scientist of Baker Hughes, and he's basically taken a

713
00:36:45,239 --> 00:36:48,680
Speaker 1: lot of ultra advanced oil and gas rig technology and

714
00:36:49,120 --> 00:36:52,680
Speaker 1: invented a miniaturized rig that can drill subsurface to the

715
00:36:52,680 --> 00:36:56,120
Speaker 1: depth required to unlock heating and cooling for huge buildings.

716
00:36:56,400 --> 00:36:58,640
Speaker 1: So CI am the largest asset owner America with a

717
00:36:58,640 --> 00:37:01,600
Speaker 1: million square feet on her ownership invested in this technology.

718
00:37:01,880 --> 00:37:05,080
Speaker 1: And this sounds like geothermal, It is geothermal heating and

719
00:37:05,120 --> 00:37:08,640
Speaker 1: cooling which is previously inaccessible to big buildings because of

720
00:37:08,680 --> 00:37:11,480
Speaker 1: the depth required to drill would meet a rig that

721
00:37:11,520 --> 00:37:15,080
Speaker 1: can't operate in urban environments. And so the magic of

722
00:37:15,120 --> 00:37:17,440
Speaker 1: this company is they can go to companies and say, look,

723
00:37:17,800 --> 00:37:20,799
Speaker 1: I can beat your heating and cooling bills with a

724
00:37:20,840 --> 00:37:23,880
Speaker 1: decarbonized solution that will save you money and op X

725
00:37:24,280 --> 00:37:26,279
Speaker 1: and get you an unbelievable amount of credits from the

726
00:37:26,360 --> 00:37:28,839
Speaker 1: US government. And so those are technologies we get really

727
00:37:28,840 --> 00:37:31,560
Speaker 1: excited about. Built environment is forty percent of global emissions

728
00:37:31,600 --> 00:37:34,000
Speaker 1: forty percent, So it is not a sexy sounding thing,

729
00:37:34,040 --> 00:37:35,920
Speaker 1: but it's very important. If you want to think about

730
00:37:35,920 --> 00:37:38,239
Speaker 1: some of the more interesting sort of risk on parts

731
00:37:38,239 --> 00:37:41,520
Speaker 1: of our portfolio. There's an unbelievable company called Linean Labs

732
00:37:41,520 --> 00:37:44,880
Speaker 1: we recently invested in alongside Union's coare Ventures and a

733
00:37:44,880 --> 00:37:49,200
Speaker 1: bunch of other unbelievable funds. They're building sustainable aviation fuels.

734
00:37:49,440 --> 00:37:53,440
Speaker 1: Sustainable aviation fuels can take industrial CO two waste and

735
00:37:53,520 --> 00:37:56,720
Speaker 1: repurpose it and remake it using a Fisher trough process

736
00:37:56,719 --> 00:37:59,520
Speaker 1: and a reverse water gas shifter to then produce sustainably

737
00:37:59,520 --> 00:38:01,960
Speaker 1: aviation fuels. And we think this company can do it

738
00:38:02,040 --> 00:38:05,080
Speaker 1: cheaper ultimately than what jet fuel a costs in the

739
00:38:05,080 --> 00:38:07,880
Speaker 1: market over time. And so when you consider United Airlines,

740
00:38:07,920 --> 00:38:10,640
Speaker 1: in these companies, all of which have made commitments to

741
00:38:10,719 --> 00:38:13,920
Speaker 1: use half of their fuel mix for jet for sustainabiliation fuel,

742
00:38:14,200 --> 00:38:16,800
Speaker 1: there's a software like scale up a thousand x increases

743
00:38:16,800 --> 00:38:18,640
Speaker 1: we're gonna need to see in the coming years. And

744
00:38:18,680 --> 00:38:21,080
Speaker 1: so that gets really exciting. If you can beat jet

745
00:38:21,080 --> 00:38:24,000
Speaker 1: fuel at their own game and produce something cheaper, why

746
00:38:24,040 --> 00:38:25,839
Speaker 1: wouldn't an airline want to use that?

747
00:38:25,920 --> 00:38:28,360
Speaker 2: And so so it's funny funny you mentioned airlines. So

748
00:38:28,440 --> 00:38:34,759
Speaker 2: when we look at ethanol, they're notoriously subject to they're

749
00:38:34,800 --> 00:38:38,640
Speaker 2: they're not as stable as petroleum. If you put them

750
00:38:38,680 --> 00:38:42,759
Speaker 2: in marine engines, especially in a salt water environment, there's

751
00:38:42,800 --> 00:38:45,120
Speaker 2: a problem with with they tend to gunk up and

752
00:38:45,480 --> 00:38:49,960
Speaker 2: they don't do well. And the tolerances in aviation fuel

753
00:38:50,480 --> 00:38:57,799
Speaker 2: are even more stringent than maritime or or automotive. You

754
00:38:57,880 --> 00:39:00,880
Speaker 2: can come up with some form of av fuel that

755
00:39:01,200 --> 00:39:05,880
Speaker 2: is able to fit those demands, and that incredibly high

756
00:39:05,920 --> 00:39:08,280
Speaker 2: requirements from the aviation industry.

757
00:39:08,680 --> 00:39:11,359
Speaker 1: Yes, think of being able to drop something into their

758
00:39:11,400 --> 00:39:15,200
Speaker 1: existing engines molecularly identical to jet fuel, a that happens

759
00:39:15,200 --> 00:39:18,160
Speaker 1: to be entirely carbon neutral, something that is actually derived

760
00:39:18,200 --> 00:39:21,880
Speaker 1: from captured CO two, either atmospherically or otherwise. And so

761
00:39:22,040 --> 00:39:24,359
Speaker 1: this is what gets us excited, right. Hydrogen aircraft would

762
00:39:24,360 --> 00:39:26,680
Speaker 1: require you to invent a new aircraft. I think about

763
00:39:26,680 --> 00:39:29,680
Speaker 1: how long FAA approvals take. Electric aircraft will be great

764
00:39:29,680 --> 00:39:32,359
Speaker 1: for short distances, but for long haul aircraft, we don't

765
00:39:32,400 --> 00:39:34,400
Speaker 1: see a path given the weight and density of those

766
00:39:34,440 --> 00:39:37,160
Speaker 1: lithium ion batteries that you mentioned. And so if you

767
00:39:37,239 --> 00:39:40,520
Speaker 1: can provide the multi you know, hundreds of billions of

768
00:39:40,560 --> 00:39:44,000
Speaker 1: dollars of jet fuel that is consumed every year with

769
00:39:44,120 --> 00:39:47,480
Speaker 1: something fully decarbonized, it's going to be a much attractive

770
00:39:47,480 --> 00:39:49,880
Speaker 1: and more easier path for airlines to adopt.

771
00:39:50,200 --> 00:39:53,920
Speaker 2: So you would mentioned how complex the regulatory environment is

772
00:39:53,960 --> 00:39:59,400
Speaker 2: for nuclear How much have the recent legislation the IRA,

773
00:39:59,600 --> 00:40:02,680
Speaker 2: the same Doctor Acting Infrastructure Bill. How much has that

774
00:40:03,000 --> 00:40:06,360
Speaker 2: allowed things to happen more quickly than they have in

775
00:40:06,400 --> 00:40:09,480
Speaker 2: the past in terms of regulatory approval.

776
00:40:09,640 --> 00:40:13,920
Speaker 1: It's hard to overstate how staggering and ambitious and exciting

777
00:40:13,920 --> 00:40:17,240
Speaker 1: the Inflation Reduction Act is. This is the single most

778
00:40:17,840 --> 00:40:22,560
Speaker 1: comprehensive and aggressive climate bill ever produced by any country anywhere.

779
00:40:23,120 --> 00:40:27,160
Speaker 1: And what this is doing is allowing OEMs and asset

780
00:40:27,160 --> 00:40:30,880
Speaker 1: owners to pull forward innovation because it is simply making

781
00:40:30,920 --> 00:40:34,560
Speaker 1: these things cheaper than fossil fuel alternatives because of these

782
00:40:34,600 --> 00:40:38,000
Speaker 1: eyewatering incentives. And so interestingly, I'll give you an example.

783
00:40:38,000 --> 00:40:40,360
Speaker 1: We actually have a company and a software company called Crux,

784
00:40:40,600 --> 00:40:43,600
Speaker 1: which is a marketplace for tax credits generated by the IRA.

785
00:40:44,000 --> 00:40:46,960
Speaker 1: The ITC and PTC tax credits will be about eighty

786
00:40:47,040 --> 00:40:49,600
Speaker 1: three billion dollars per year according to Credit Suites, which

787
00:40:49,680 --> 00:40:52,719
Speaker 1: is about seventeen percent of total corporate tax liability. And

788
00:40:52,760 --> 00:40:55,239
Speaker 1: so this will have to flow from the producers of

789
00:40:55,280 --> 00:40:59,040
Speaker 1: those credits to big banks, family office places like where

790
00:40:59,080 --> 00:41:01,440
Speaker 1: you work. That connecttion you monetize those credits and help

791
00:41:01,480 --> 00:41:04,600
Speaker 1: their client. Your clients save money today on taxes, and

792
00:41:04,680 --> 00:41:07,680
Speaker 1: so these software marketplaces will be really an interesting way

793
00:41:07,680 --> 00:41:11,720
Speaker 1: of demonstrating how giant the IRA opportunity is today.

794
00:41:12,080 --> 00:41:17,080
Speaker 2: So, what's the big obstacle that this form of investing faces.

795
00:41:17,160 --> 00:41:20,920
Speaker 2: This has been pushed back to ESG and the concept

796
00:41:20,960 --> 00:41:26,160
Speaker 2: of greenwashing. What you're really talking about is innovation on

797
00:41:26,239 --> 00:41:30,000
Speaker 2: the level of basic science as a physics, chemical chemistry,

798
00:41:30,320 --> 00:41:34,879
Speaker 2: material science. Tell us a little bit about what sort

799
00:41:34,920 --> 00:41:36,160
Speaker 2: of skepticism you face.

800
00:41:36,920 --> 00:41:38,880
Speaker 1: Well, for one, we can never bend the laws of

801
00:41:38,880 --> 00:41:41,839
Speaker 1: physics or chemistry, and so we are taking engineering risk,

802
00:41:41,880 --> 00:41:44,400
Speaker 1: but we don't take science risk as a fund. I

803
00:41:44,400 --> 00:41:48,240
Speaker 1: think the two hardest things to bet on are sticks

804
00:41:48,239 --> 00:41:51,040
Speaker 1: that come from the federal government that will actually, you know,

805
00:41:51,160 --> 00:41:54,120
Speaker 1: put a price on carbon and ultimately ban a lot

806
00:41:54,120 --> 00:41:57,720
Speaker 1: of fossil fuel alternatives. And second, higher interest rate environments

807
00:41:57,719 --> 00:42:00,920
Speaker 1: are going to be enormously punishing for capital and teens transitions.

808
00:42:00,960 --> 00:42:04,560
Speaker 1: And so I think the two obstacles we face today

809
00:42:04,920 --> 00:42:07,560
Speaker 1: are thankfully not technology, right, A lot of the technology

810
00:42:07,560 --> 00:42:09,399
Speaker 1: we need to do this transition is here. The two

811
00:42:09,440 --> 00:42:12,680
Speaker 1: obstacles are one, what's the regulatory environment that will force

812
00:42:12,719 --> 00:42:15,520
Speaker 1: fossil fuels off a cliff. And then two, how do

813
00:42:15,560 --> 00:42:17,759
Speaker 1: we ensure that this isn't more expensive? Because if you

814
00:42:17,800 --> 00:42:20,440
Speaker 1: go to working class Americans and a bunch of you know,

815
00:42:20,520 --> 00:42:25,080
Speaker 1: a feat over educated coastal elites say take this electric vehicle,

816
00:42:25,080 --> 00:42:26,600
Speaker 1: take this heat pump, it'll be better for you, and

817
00:42:26,640 --> 00:42:29,480
Speaker 1: it ends up more expensive, that will break the Democratic

818
00:42:29,520 --> 00:42:32,839
Speaker 1: Party apart. And so we need to really focus on

819
00:42:32,880 --> 00:42:34,279
Speaker 1: how do we do this as what they call a

820
00:42:34,440 --> 00:42:37,160
Speaker 1: just transition. How do you help you know, working class

821
00:42:37,160 --> 00:42:39,279
Speaker 1: Americans actually save money on their bills, how do you

822
00:42:39,280 --> 00:42:42,560
Speaker 1: produce give them something that is not just better but cheaper.

823
00:42:43,080 --> 00:42:45,920
Speaker 1: The median you know, savings account in America right now

824
00:42:46,000 --> 00:42:48,600
Speaker 1: is four hundred dollars of total savings. And so if

825
00:42:48,600 --> 00:42:50,239
Speaker 1: you go to someone say I need ninety percent of

826
00:42:50,239 --> 00:42:52,600
Speaker 1: that for a heat pump today, that's going to be

827
00:42:52,640 --> 00:42:53,120
Speaker 1: a problem.

828
00:42:53,360 --> 00:42:58,600
Speaker 2: What do you think of products like the Ford Lightning

829
00:42:59,120 --> 00:43:01,799
Speaker 2: one point fifty, which I think the base price is

830
00:43:01,840 --> 00:43:05,640
Speaker 2: something like forty thousand dollars that looks like a truck

831
00:43:05,680 --> 00:43:07,200
Speaker 2: that could find it. Did it go up?

832
00:43:07,200 --> 00:43:09,160
Speaker 1: It's fifty thousand dollars expensive.

833
00:43:09,400 --> 00:43:12,680
Speaker 2: It started originally at forty, maybe it's fifty now, Like

834
00:43:12,719 --> 00:43:15,440
Speaker 2: the cyber truck started at forty at sixty now, but

835
00:43:15,680 --> 00:43:18,960
Speaker 2: the lightning seems to be sort of that looks like

836
00:43:19,040 --> 00:43:21,880
Speaker 2: a regular truck, but you could power your house with it.

837
00:43:22,520 --> 00:43:26,040
Speaker 2: Are these things going to be useful in our energy transition?

838
00:43:26,400 --> 00:43:27,960
Speaker 1: You know? One of the tensions I have, just to

839
00:43:27,960 --> 00:43:32,080
Speaker 1: speak plainly, is that Americans like to drive big things.

840
00:43:32,200 --> 00:43:35,400
Speaker 1: But from a climate perspective, ultimately it is kind of

841
00:43:35,440 --> 00:43:37,839
Speaker 1: a joke to say, like the EV hummer is good.

842
00:43:37,880 --> 00:43:39,920
Speaker 1: You know, you're actually better off driving a used F

843
00:43:39,920 --> 00:43:43,399
Speaker 1: one to fifty Ford Ranger than buying a new EV

844
00:43:43,520 --> 00:43:45,880
Speaker 1: hummer because of the you know, carbon intensity of the

845
00:43:45,880 --> 00:43:50,120
Speaker 1: manufacturing process. And so that's the thing we need to missauge.

846
00:43:50,160 --> 00:43:52,280
Speaker 1: We do need to make this transition. You should probably

847
00:43:52,320 --> 00:43:56,360
Speaker 1: surprise in the like customers, but buying giant heavy vehicles

848
00:43:56,360 --> 00:43:58,120
Speaker 1: that are not traveling very far and don't need to

849
00:43:58,120 --> 00:44:01,360
Speaker 1: be as giant and heavy is not the ideal outcome.

850
00:44:01,440 --> 00:44:04,120
Speaker 1: Though probably this sort of consumer taste is here and

851
00:44:04,120 --> 00:44:04,960
Speaker 1: we need to fulfill it.

852
00:44:05,000 --> 00:44:07,440
Speaker 2: What we need to do is take like a nineteen

853
00:44:07,560 --> 00:44:11,320
Speaker 2: eighties era portion nine to eleven and convert those.

854
00:44:11,120 --> 00:44:12,959
Speaker 1: To who we're talking. Yeah, that can be my gift

855
00:44:12,960 --> 00:44:15,320
Speaker 1: after doing this podcast if you wanted to tend that

856
00:44:15,400 --> 00:44:15,600
Speaker 1: to me.

857
00:44:16,160 --> 00:44:19,040
Speaker 2: So let me jump to my favorite questions. We'll only

858
00:44:19,080 --> 00:44:22,560
Speaker 2: have you for a few minutes, starting with tell us

859
00:44:22,640 --> 00:44:25,800
Speaker 2: you mentioned Oppenheimer. Tell us what you're watching or streaming,

860
00:44:26,000 --> 00:44:27,320
Speaker 2: what's keeping you entertained.

861
00:44:28,160 --> 00:44:33,320
Speaker 1: There's an unbelievable TV show about the French intelligence service

862
00:44:33,400 --> 00:44:36,439
Speaker 1: called The Bureau that is a must watch and it's

863
00:44:36,440 --> 00:44:40,440
Speaker 1: sort of the like what a US allied intelligence service?

864
00:44:40,480 --> 00:44:42,799
Speaker 1: How they dealt with Syria, how they dealt with a rock,

865
00:44:42,840 --> 00:44:44,920
Speaker 1: how do they dealt with the United States from their perspective?

866
00:44:45,480 --> 00:44:46,080
Speaker 1: Must watch.

867
00:44:46,960 --> 00:44:49,600
Speaker 2: I just finished The Bodyguard, which was very interesting, and

868
00:44:49,640 --> 00:44:52,680
Speaker 2: it's the UK. And anytime you get to see how

869
00:44:52,719 --> 00:44:56,879
Speaker 2: a different country, even the entertainment, how they portray their

870
00:44:58,120 --> 00:45:02,600
Speaker 2: national security and police, it is always fascinating. Tell us

871
00:45:02,600 --> 00:45:05,360
Speaker 2: about your mentors who helped shape your career.

872
00:45:05,880 --> 00:45:08,920
Speaker 1: You know, my father, who is still the closest person

873
00:45:08,960 --> 00:45:11,480
Speaker 1: to me in my life apart from my wife, was

874
00:45:11,520 --> 00:45:13,400
Speaker 1: my earliest mentor and I couldn't be lucky to have

875
00:45:13,480 --> 00:45:15,719
Speaker 1: had him. And he was the one that always challenged us.

876
00:45:16,040 --> 00:45:18,040
Speaker 1: Let us said, you can do anything, but whatever you

877
00:45:18,120 --> 00:45:21,759
Speaker 1: do be the best at you know, push yourself and

878
00:45:21,800 --> 00:45:23,520
Speaker 1: do something big and help a lot of people. And

879
00:45:23,560 --> 00:45:25,799
Speaker 1: so that is the sort of challenge that continues to

880
00:45:25,800 --> 00:45:28,120
Speaker 1: push me today. I was also really lucky to work

881
00:45:28,160 --> 00:45:33,320
Speaker 1: for Governor Martin O'Malley, really closely with President Obama and

882
00:45:33,680 --> 00:45:36,560
Speaker 1: learn from them. And then guys like Julius Genakowski, who

883
00:45:36,600 --> 00:45:38,960
Speaker 1: is the FCC chairman, who's a partner at Carlisle now

884
00:45:39,000 --> 00:45:41,520
Speaker 1: an investor in overture, has been a long time mentor

885
00:45:41,560 --> 00:45:43,840
Speaker 1: and friend to me. And I'm also mentored by my friends.

886
00:45:43,840 --> 00:45:46,360
Speaker 1: You know, they say, to be happy, make friends that

887
00:45:46,360 --> 00:45:49,080
Speaker 1: are less successful you to be successful, make friends more

888
00:45:49,080 --> 00:45:51,160
Speaker 1: successful than you. And all of my friends are more

889
00:45:51,160 --> 00:45:52,919
Speaker 1: successful than me. I learned from them all the time.

890
00:45:52,960 --> 00:45:55,319
Speaker 1: And although you know what's like gorviy doll line, every

891
00:45:55,360 --> 00:45:57,200
Speaker 1: time a friend succeeds, a small part of me dies,

892
00:45:57,640 --> 00:45:59,000
Speaker 1: you might still feel a little bit of that.

893
00:45:59,000 --> 00:46:01,799
Speaker 2: But such a terror terrible I mean, I'm familiar with

894
00:46:01,800 --> 00:46:05,600
Speaker 2: the quote. It's such a terrible, terrible perspective. I had

895
00:46:05,640 --> 00:46:09,080
Speaker 2: a buddy from grad school who was wildly successful, and

896
00:46:09,120 --> 00:46:12,239
Speaker 2: people always ask me, doesn't it kill you how great

897
00:46:12,280 --> 00:46:12,919
Speaker 2: Jeff is doing?

898
00:46:12,960 --> 00:46:13,920
Speaker 1: I got a root for your friends.

899
00:46:14,840 --> 00:46:16,600
Speaker 2: He's one of my favorite people in the world. No

900
00:46:16,600 --> 00:46:19,920
Speaker 2: one deserves it more, and no one believed me, absolutely

901
00:46:20,120 --> 00:46:25,160
Speaker 2: absolutely nobody. Nobody believed me. So tell us about some

902
00:46:25,200 --> 00:46:27,360
Speaker 2: of your favorite books. What are you reading right now?

903
00:46:28,160 --> 00:46:30,719
Speaker 1: Books to recommend to the listeners. The Ministry for the

904
00:46:30,760 --> 00:46:32,759
Speaker 1: Future is the probably the best book on climate I've

905
00:46:32,760 --> 00:46:33,200
Speaker 1: ever read.

906
00:46:33,239 --> 00:46:34,840
Speaker 2: It's Ministry for the Future.

907
00:46:34,840 --> 00:46:37,440
Speaker 1: Ministry for the Future. It's a climate dystopia of you know,

908
00:46:37,520 --> 00:46:41,120
Speaker 1: the first chapter involves twenty million Indians dying in a

909
00:46:41,160 --> 00:46:43,400
Speaker 1: heat wave and we are going to start seeing thermal

910
00:46:43,640 --> 00:46:45,680
Speaker 1: temperatures around one hundred and fifty five degrees, which has

911
00:46:45,719 --> 00:46:48,680
Speaker 1: got clocked in Tehran, and so imagine what happens to

912
00:46:48,760 --> 00:46:51,080
Speaker 1: human life? How does human life flourish in those temperatures?

913
00:46:51,760 --> 00:46:54,480
Speaker 1: And then every other chapter is a scientific sort of

914
00:46:54,520 --> 00:46:57,760
Speaker 1: examination of the underlying sort of science transition. So Ministry

915
00:46:57,760 --> 00:47:02,280
Speaker 1: for the Future is fantastic. Just read David Wallace Wells's

916
00:47:02,280 --> 00:47:07,000
Speaker 1: book The Uninhabitable Earth, which is excellent. You'll need a

917
00:47:07,040 --> 00:47:08,600
Speaker 1: shot of whiskey after reading it.

918
00:47:08,680 --> 00:47:11,560
Speaker 2: Oh, really a little depressing, a little tough.

919
00:47:11,719 --> 00:47:13,239
Speaker 1: But you know, he has this sort of line that

920
00:47:13,280 --> 00:47:14,560
Speaker 1: our kids will look at us in the eye one

921
00:47:14,600 --> 00:47:16,799
Speaker 1: day and say what were you thinking? Or were you

922
00:47:16,840 --> 00:47:18,560
Speaker 1: even thinking at all? Which kind of haunts me.

923
00:47:19,480 --> 00:47:24,040
Speaker 2: There is a fascinating book that was very early in

924
00:47:24,280 --> 00:47:28,680
Speaker 2: energy investment called Windfall, and it's really fascinating because it

925
00:47:28,800 --> 00:47:33,840
Speaker 2: goes to the various investment banks and funds and talks

926
00:47:33,920 --> 00:47:36,840
Speaker 2: about whatever's hot's going to get hotter, whatever's what's going

927
00:47:36,920 --> 00:47:40,160
Speaker 2: to get wetter? And here are all these companies and

928
00:47:40,280 --> 00:47:45,839
Speaker 2: technologies that climate is almost secondary their for profit, and

929
00:47:45,920 --> 00:47:48,560
Speaker 2: some of them have done exceedingly well. Really, really was

930
00:47:48,600 --> 00:47:51,280
Speaker 2: a fascinating book. And now we're down to our last

931
00:47:51,280 --> 00:47:54,760
Speaker 2: two questions. What sort of unless you have more books?

932
00:47:54,760 --> 00:47:58,120
Speaker 2: Did I interrupt the book? Fly? All right? What sort

933
00:47:58,160 --> 00:48:00,880
Speaker 2: of advice would you give to a recent college grad

934
00:48:01,400 --> 00:48:08,279
Speaker 2: interested in a career in either climate change investing, venture investing,

935
00:48:08,680 --> 00:48:09,480
Speaker 2: or politics.

936
00:48:11,480 --> 00:48:14,400
Speaker 1: I think a startup is the equivalent of a campaign,

937
00:48:14,640 --> 00:48:19,520
Speaker 1: which is incredibly flat, incredibly labor intensive, and so my

938
00:48:19,560 --> 00:48:21,480
Speaker 1: advice to anyone that wants to get involved in politics

939
00:48:21,560 --> 00:48:23,520
Speaker 1: or in climate is go work at a startup, or

940
00:48:23,520 --> 00:48:26,480
Speaker 1: go work in a campaign, and just be the person

941
00:48:26,520 --> 00:48:28,719
Speaker 1: they can turn to if you figure that out, if

942
00:48:28,719 --> 00:48:30,080
Speaker 1: you can be a person that I can turn to,

943
00:48:30,200 --> 00:48:33,000
Speaker 1: or any leader can turn to and know that they

944
00:48:33,040 --> 00:48:35,120
Speaker 1: are going to handle that task. Well, you know, there's

945
00:48:35,160 --> 00:48:36,200
Speaker 1: a really quick ramp.

946
00:48:36,080 --> 00:48:39,279
Speaker 2: Rate for you. And our final question, what do you

947
00:48:39,280 --> 00:48:42,799
Speaker 2: know about the world of venture investing today? You wish

948
00:48:42,800 --> 00:48:44,959
Speaker 2: you knew ten twenty years ago when you were first

949
00:48:44,960 --> 00:48:46,160
Speaker 2: getting started.

950
00:48:46,680 --> 00:48:48,279
Speaker 1: That it would have been better to get started ten

951
00:48:48,360 --> 00:48:49,280
Speaker 1: years ago than today.

952
00:48:50,160 --> 00:48:52,360
Speaker 2: So that wasn't too early ten years ago.

953
00:48:52,239 --> 00:48:53,960
Speaker 1: No, I think ten years ago it was still a

954
00:48:54,000 --> 00:48:56,680
Speaker 1: little bit more of a cottage industry with ultra low

955
00:48:56,680 --> 00:48:59,960
Speaker 1: cost interest rates and the zero interest rate environment allows

956
00:49:00,360 --> 00:49:05,240
Speaker 1: folks to take rewarding bets that you know, delayed revenue

957
00:49:05,280 --> 00:49:08,400
Speaker 1: recognition for ten years because it was a quick, effectively

958
00:49:08,440 --> 00:49:11,480
Speaker 1: free and so that was a heyday. I wish I

959
00:49:11,520 --> 00:49:13,640
Speaker 1: had been doing venture more consciously then.

960
00:49:14,000 --> 00:49:16,279
Speaker 2: You know, it's funny I say the same thing about

961
00:49:16,360 --> 00:49:19,200
Speaker 2: running an investment firm, because I see these firms have

962
00:49:19,320 --> 00:49:22,319
Speaker 2: been around thirty forty years and it's like, God, if

963
00:49:22,360 --> 00:49:24,680
Speaker 2: I would have started in you know, eighty two, we'd

964
00:49:24,719 --> 00:49:27,319
Speaker 2: be a trillion dollars. I can't. I feel like I'm

965
00:49:27,400 --> 00:49:30,399
Speaker 2: late to the party. I recognize the same thing with you,

966
00:49:30,760 --> 00:49:33,320
Speaker 2: but it's never too you know, ten years ago was

967
00:49:33,400 --> 00:49:36,280
Speaker 2: always the best time to do something, and the second

968
00:49:36,320 --> 00:49:37,200
Speaker 2: best time is right now.

969
00:49:37,200 --> 00:49:39,760
Speaker 1: There is a Chinese proverb the best time to plant

970
00:49:39,760 --> 00:49:41,520
Speaker 1: a tree was one hundred years ago, but the second

971
00:49:41,560 --> 00:49:45,080
Speaker 1: best time is today. Perfect. But I will say, you know,

972
00:49:45,520 --> 00:49:48,400
Speaker 1: I do think in climate is one of these mega

973
00:49:48,480 --> 00:49:51,000
Speaker 1: trends that is going that is just here and it

974
00:49:51,040 --> 00:49:54,320
Speaker 1: doesn't you know, it is probably the easiest arbitrage investment

975
00:49:54,440 --> 00:49:57,440
Speaker 1: I can imagine, which is to bet on scientists or

976
00:49:57,640 --> 00:50:00,480
Speaker 1: you know, an opinions that editor at the wall Stree Journal.

977
00:50:00,800 --> 00:50:03,760
Speaker 1: And so, you know, I just recommend to the listeners

978
00:50:03,800 --> 00:50:05,560
Speaker 1: to really start paying attention to this. Once you start

979
00:50:05,600 --> 00:50:08,359
Speaker 1: looking at it, the investment opportunity, the opportunity to make

980
00:50:08,440 --> 00:50:11,879
Speaker 1: money is eyewatering. In addition to being able to sleep

981
00:50:11,920 --> 00:50:12,359
Speaker 1: all night.

982
00:50:12,640 --> 00:50:15,880
Speaker 2: That's great. We have been speaking with show Meek Dutta,

983
00:50:16,160 --> 00:50:20,359
Speaker 2: co founder and managing partner at Overture Climate VC. If

984
00:50:20,400 --> 00:50:23,000
Speaker 2: you enjoy this conversation, well, be sure and check out

985
00:50:23,239 --> 00:50:26,000
Speaker 2: any of the previous five hundred or so we've done

986
00:50:26,120 --> 00:50:31,200
Speaker 2: over the past nine years. You can find those at iTunes, Spotify, YouTube,

987
00:50:31,560 --> 00:50:35,480
Speaker 2: wherever you find your favorite podcasts. Sign up from my

988
00:50:35,600 --> 00:50:38,719
Speaker 2: daily reading list at Ridhelts dot com. Follow me on

989
00:50:38,760 --> 00:50:41,560
Speaker 2: Twitter or x or whatever you want to call it.

990
00:50:42,200 --> 00:50:45,160
Speaker 2: Hopefully it's still around by the time this broadcast. At

991
00:50:45,239 --> 00:50:49,360
Speaker 2: Ridholt's follow all of the Bloomberg Family of podcasts at

992
00:50:49,600 --> 00:50:52,319
Speaker 2: podcast I would be remiss if I did not thank

993
00:50:52,360 --> 00:50:55,720
Speaker 2: the crack team that helps me put these conversations together

994
00:50:55,920 --> 00:51:00,239
Speaker 2: each week. My engineer this week is Kayleie Lapara uh

995
00:51:00,239 --> 00:51:02,680
Speaker 2: A tick of Al Brown is our project manager. Sean

996
00:51:02,800 --> 00:51:06,480
Speaker 2: Russo is my head of research. Anna Luke is my producer.

997
00:51:07,160 --> 00:51:11,120
Speaker 2: I'm Barry Ritolts. You've been listening to Masters Business on

998
00:51:11,239 --> 00:51:12,760
Speaker 2: Bloomberg Radio.