(gentle music)
- So Mike, you joined Gates Ventures in 2016
and helped establish Breakthrough Energy.
What is Breakthrough Energy and what is unique
about their approach to tackling climate change?
- Sure, Bill Gates, my boss, started Breakthrough Energy
in 2015 around the time of the Paris climate talks
really as a way to inject the notion
of innovation and the need for innovation
in the climate conversation in a much bigger way.
Breakthrough started with a venture fund back in the day,
which has now grown to more than a few billion dollars
and investing in more than a hundred portfolio companies.
But it also has a few other platforms
that have stood up over time to really think
about the end-to-end innovation cycle,
from the very earliest sort of discovery science
and early research side of things through the development
and demonstration of some of that technology
in the venture context or as you're doing company building.
And then the Catalyst program is our attempt to say:
Great, we've got lots of those innovations.
We've got companies out there, some within Breakthrough,
many not, who are making really good progress,
but they need to build their first hydrogen facility.
They need to build their first large-scale demonstration
sustainable aviation fuel facility.
And that is not a place that traditional capital
is flocking.
Part of what we're trying to do is
to incent people to be first movers in this
and to really come out with some level of creativity
and some level of boldness to be able to say,
"I know this might cost me a little bit more
in the short term.
I know there's risk associated with this
but it's worth doing."
- Can you tell me a little more about that distinction
between the Ventures operating as a for-profit entity
and Catalyst operating as a non-profit philanthropic entity
and how that is helping accelerate
these climate technologies?
- Well, when you think about that innovation arc
that I was talking about
from early discovery through to deployment and scale,
the reality is you need all flavors
of money to be able to do that.
And so actually across that platform, there's a great mix.
Our Fellows program right now
is 100% philanthropic as well.
We're putting super patient, non-expectant return capital
into those Fellows and their projects to see
if we can accelerate them to a commercial place.
The Ventures side of things is purely private capital,
putting equity dollars into startups and companies.
There's more than a hundred of those that we've invested in
really across all of the highest emitting sectors.
And then on the Catalyst side, what we tried to do
is actually bring a blend.
What we have is a Breakthrough Energy Catalyst Foundation
where those philanthropic dollars sit and then we have
a private fund where the private capital sits.
Depending on the needs
of the project and the project developer,
we'll bring that different flavor of money to it.
And so we decided to focus initially
on four main technology areas: green hydrogen,
direct air carbon capture, long-duration energy storage,
and sustainable aviation fuel.
We've since expanded that to a fifth area
around industrial uses, so steel, cement, plastics.
And our hope is that we're really trying to break the kind
of chicken-and-egg problem that exists where, you know,
there's technologies that are available,
but they're still too expensive
and so they never quite lift off.
But the blend of both private capital
and philanthropic capital,
with the other dollars that are available,
is starting to accelerate those
more than they otherwise would.
- Which climate technologies do you think would drive
the biggest climate impact towards a low-carbon economy?
- The truth is we need all of them, right?
I mean, we really are hoping to be a voice
in this climate conversation that is super inclusive
about the solutions that we need out there.
We think about things like from the power side
of advanced geothermal or advanced nuclear fission
and fusion.
We think about things like hydrogen,
all of the many applications for hydrogen.
We think about removal of carbon from the atmosphere
and direct air capture and other tools.
But there are a whole host of those technologies with lots
of people trying to tackle that from different angles.
And we're making bets on lots of those
because the truth is there isn't one great silver bullet for this.
We really feel like we need to be sort
of looking under every rock at the possibilities.
- At BCG, we get our clients asking us all the time
how does Breakthrough Energy do it?
What would you have to tell them in terms of
how they can approach the problem
and be part of the solution?
- One of the things we really try to get people focused on
is to remain optimistic, right?
It is not easy, as you said, and it's also not impossible.
We approach this by thinking about:
How do we increase the supply of innovation?
In a world that is trying to tackle climate and clean energy
from a whole bunch of angles,
how do we maximize the opportunities
and shots on goal?
And so there's lots of opportunity for others outside
of Breakthrough to do the same and to join us on that.
- Breakthrough Energy and BCG have been partnering
for the last couple of years.
I'm curious to hear from your perspective,
how has BCG's collaboration helped Breakthrough
on its mission?
- BCG has been a phenomenal partner for us.
The level of expertise and the depth
and the kind of nuanced understanding
of what is it that these companies need, right?
What is it across these geographies that is different
and bespoke that we need to be sure we're navigating?
What are the economic
and financial geopolitical considerations
that we need to be mindful of? Just given the range
of folks you have around the table at BCG,
that expertise has, I think,
made particularly our Catalyst program
but across the Breakthrough Energy platform,
a deeper level of understanding that makes us smarter
about how to navigate some of these industries.
(calm music)