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Breakthrough Energy Ventures: Bill Gates Energy Play

A photo of a robot hand typing on a laptop keyboard with the logo of Microsoft on the screen amidst Microsoft's recent acquisitions

Bill Gates is one of the most influential thinkers and investors of our time, known for creating innovations that almost always have bold impacts within various industries. Recently he shared some thoughts on Breakthrough Energy Ventures, a $1 billion fund which invests in long-term research for cheap, reliable and clean energy. The various names and personalities involved in this project have a long history of investing in potential energy sources.

The various projects and technologies are not expected to bear fruit within the next 3 to 5 years. In fact, it is estimated that it could take up to 20 years for these innovations to be ready for the market.

The main idea behind the investment fund is that by 2050, the world would need twice the energy that is currently being produced. Between now and 2050, new and innovative ways for energy production and distribution have to be created and put into line. This is just one part of the many goals Ventures has.

Grand Challenges

The project has outlined five grand challenges, which all contribute to worldwide greenhouse gas emissions:

  1. Electricity – More electricity will be needed by 2050. The question is, how do we generate the reliable and affordable electricity without consequently creating a large carbon footprint?
  2. Buildings – Eliminating emissions from homes, offices, hospitals, schools and homes.
  3. Manufacturing – Factories will still exist. How can factories create objects without emitting greenhouse gases?
  4. Transportation – How to transport goods, and people without having an impact on greenhouse gases (GHG)?
  5. Food – How to grow food and distribute it to the people without further deforestation and climate change.
    Breakthrough Energy Ventures: 5 needs for energy.

In general, investments in startups and growth companies are a gamble. The technology may or may not work. It may not be feasible on a large scale. People might not want to use it. As such, Bill Gates advocates an approach which may be alien to non-investors.

He says that there is a need to fail fast, as well as avoiding investing in large factories, refineries and technologies which might not work. Anticipating that there would be failures along the way, it is necessary to be investing in multiple technologies. The idea would be to give opportunity for other technologies to prosper or develop.

In essence, this is not much different from the approach used by the Manhattan Project in creating the first atomic bomb. There were various engineering and metallurgical obstacles in the project that it became necessary to continue research and development for all the various possibilities.

Gates $1 Billion Fund

The Breakthroughs Energy Ventures does not have the same urgency as the Manhattan Project, nor does it have a vast amount of money, but $1 billion is still a lot to go around. To raise the fund took a substantial number of people. These were all veteran investors with a like mind towards investing in a wide range of tech startups, as well as having the savvy to be patient. The various projects and technologies are not expected to bear fruit within the next 3 to 5 years. In fact, it is estimated that it could take up to 20 years for these innovations to be ready for the market.

Included among the biggest investors who have put their money into the venture fund are Vinod Khosla, John Doerr, and John Arnold. Other investors include Richard Branson, Mukesh Ambani from India, Prince Alwaleed bin Talal of Saudi Arabia, Ray Dalio, LinkedIn’s Reid Hoffman, Chris Hohn from the UK, Facebook’s Dustin Moskovitz and Cari Tuna, Zhang Xin and Pan Shiyi from China, Frenchman Xavier Niel, Patrice Motsepe of South Africa, SAP co-founder Hasso Plattner, Julian Robertson and Masayoshi Son of Japan.

The combined efforts of these movers and shakers are sure to make a bold impact on the energy industry as well as other niches.

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