FULL TRANSCRIPT
Slava Rubin (00:00)
Okay, let's get started. My name's Slava Rubin. I'm one of the founders here at Vincent. We also have Jan Erik with us at Sacra. Jan Erik, say hi.
Jan-Erik Asplund (00:09)
Hey, thanks for having me again.
Slava Rubin (00:10)
Absolutely. We always love having you here. of course, Vincent, we have a lot of information for pre-IPO, whether it's our podcast, Smart Humans, whether it's the Alternative Investments Report, and obviously this pre-IPO series, SACRA is great for all kinds of diligence and deep dives into the pre-IPO companies. So we've been having this conversation for years now across many different topics, and one that we have not covered is energy.
nuclear and other energy sources. You know, it's never really been a hot topic as it is now, where it's really at the convergence of AI and build outs and the grid. And now all of a sudden nuclear is getting really hot. So it's really a topic that people have been asking for for a while. So we're excited to have it for you today.
So, in terms of our audience, it's pretty similar. we typically are getting about 75% accredited and about 75% experienced, and that's kind of what we have. And over 50% of them are looking to invest into pre-IPO in the next 12 months. Pre-IPO has been very hot. Obviously, some of you have gotten into SpaceX before the IPO or since the IPO. We've been covering SpaceX quite a bit on this series and in these discussions.
But energy and nuclear is pretty new for us. So there'll be some new names and I'm sure there'll be lots of questions. Let's go to the next slide.
First a word from our compliance department. Nothing in this presentation should be construed as an offer to sell securities or a solicitation of an offer by securities. All investments involve risk and possibility of loss, including loss of principal and neither past performance nor forward looking information is a guarantee of future results.
So let's dive in and first we're gonna talk about what is power, why is it interesting now? But before we get there, let's ask a quick survey and you'll be able to vote, which is how many of you are looking to invest into this space, nuclear energy, in the next twelve months?
Give everybody ten seconds to vote.
All right. And the survey says
Wow, that's a lot. Actually, one of the highest numbers we've had. during these surveys. Wow. All right. We picked a good topic. We're gonna move on. And as a reminder, wow, eighty four percent. Clearly everybody is quite bullish. We you could always ask us questions
I will do my best to keep track of the questions and try to incorporate them appropriately into the conversation. So feel free to ask any questions at any time in the Q and A All right. So eighty-four percent are ready to invest. Jan Eric, tell us some context.
Jan-Erik Asplund (02:41)
So I think before getting into nuclear, it's worth just talking about, you know, power, because nuclear is sort of just one potential input into the sort of equation of power, which is, you know, electricity being produced, electricity being consumed. and historically that's been kind of a stable equation because for a long time, electrical demand, and we're gonna talk about the US, I think a lot here. So in the US, you know, demand wasn't growing very quickly.
you know, say, you know, the the 15 or 20 years previous, you know, it was pretty much flat. And so a lot of our infrastructure was sort of built for that world. and what you have today, in addition to you know, data centers, you have electrify you have more electrification, more you know, air conditioning, you have electric vehicles, you have increased reshoring, you know, of industrial manufacturing. and so there's actually demand coming into the grid from from all angles. and data centers are
Particularly hot right now and very interesting because obviously you have hyperscalers spending billions buying GPUs, building data centers. And you know, you then have this additional problem of getting hundreds of megawatts of electricity to those sites. Otherwise, those GPUs are useless. And we are at a sort of point that, you know, this might be precipitating people's interest in this topic where, you know, there is a huge number of power projects trying to get connected into the grid.
And that can take years, which is why we have this bottleneck right now, right? 2,000 gigawatts sitting in these queues waiting to get hooked up to the grid. You know, that's kind of like a limiter on the speed at which we can build data centers and get them up and running. and so that is kind of one of these big topics right now. And and nuclear is kind of one of the hot potential answers to cute to fixing that.
Slava Rubin (04:25)
Awesome. So right away I'm getting questions as to which of these methods are going to win. We'll talk about that in a second. what are the risks to these companies? We'll talk about that. What about the political landscape? We could obviously reference that. let me ask you this: which is the data center piece is kind of making it connected to AI. So if it wasn't for the data center piece,
You know, how much growth are we having and is it as exciting? I think you've done a great job here creating the layer cake because there's this assumption that it's only the data center piece that's creating the hype. But can you talk to how much of it is only data center versus of everything else?
Jan-Erik Asplund (05:02)
Yeah, so I think the number is roughly 10% of sort of like 2030 demand by 2030, the growth from today roughly 10% is from data centers. So it's kind of funny because you do see these two things linked together a lot, especially with Sam Altman, you know, investing in Aucklo and and Helion Energy and companies like this and nuclear. You think they're very related, but in reality, you know, there is
you know, it is the need for energy is not sort of like hued specifically on data centers only. there's so much, you know, kind of need for power and connected to our sort of, you know, relatively sluggish ability to build it out further over the last decades, that, you know, you could take data centers out. It's still a big, you know, big need.
Slava Rubin (05:48)
Great. And when you talk about build out, because you're giving me numbers all the way to twenty fifty, how long does it take to do some of this build out?
Jan-Erik Asplund (05:55)
Yeah, it takes quite a while. It's it's you know, it can take years, especially with the queues, with the regulatory, some of the pol politics stuff that we'll talk about. you know, and today what we're seeing is companies like Microsoft, Meta are are saying basically we need, you know, we need five hundred megawatts, we need, you know, a gigawatt of power to this site, you know, to power a data center. And they're willing to pay a lot to get it potentially up and running in three years, you know, where like the average might be like eight.
so it definitely takes it takes time.
Slava Rubin (06:23)
Can you do you give me a simple first grader perspective on power? So what are the sizes? So you know, people talk about gigawatt, terawatt. So how does it go from smallest to largest?
Jan-Erik Asplund (06:35)
so smallest is smallest in terms of what we're sort of talking about would probably be megawatt. I that's megawatts is the smallest that we'll see. so that's a thousand kilowatts. and then a thousand megawatts is a gigawatt. so let me just start kilowatt, megawatt, gigawatt, terawatt. Everything's a thousand of of the of the last thing. the metric system is beautiful. So most cases we're gonna be talking in megawatts. Yeah.
Slava Rubin (06:57)
Sorry, say it again.
Jan-Erik Asplund (06:58)
I think a lot of what we'll be talking about is is in the megawatts still. the average kind of like large nuclear reactor is one gigawatt. so if that gives some context.
Slava Rubin (07:07)
Got it. That's super helpful. And terrawatt it's like the giant number, right?
Jan-Erik Asplund (07:11)
Yeah, a thousand gigawatts. that's like the entire US power grid today.
Slava Rubin (07:15)
Is the is the four thousand three hundred thirty five terawatts?
Jan-Erik Asplund (07:19)
yeah, exactly.
Slava Rubin (07:20)
Perfect. Perfect. I just want to make sure we we baseline ourselves. Okay, great. let's move on to the next slide.
So is a great perspective how we've evolved in kind of like eras, kinda like almost like AI eras. So give us some perspective as to what era we're in right now.
Jan-Erik Asplund (07:33)
Yeah. So in the past, for most of history, every nuclear project that ever got done in the US, you know, the customer was a power utility, right? They would decide to build a plant, raise a bunch of money, and then you would they would recover that investment over time through, you know, the electricity bills that taxpayers pay. and what we basically had was, you know, there's been not that many, you know, nuclear projects that have got being able to go through. And also a lot of them were first of their kind. So you had a lot of them
most of them you know go late, go massively over budget. And that has been a huge problem for making the economics of this work and be sustainable to produce a lot of reactors. So you know by like 2023 you kind of had this world where you know investors would say, okay, this seems great. We need power, but like who's willing to sort of absorb the risk right when all these companies are going bankrupt? Who's willing to absorb the risk of being
first one to kind of build out a modern nuclear reactor. And you know, into that vacuum has come Microsoft, Google, Amazon, Meta, these companies that you know are not regulated utilities, right? They have hundreds of billions of dollars to spend on infrastructure. They want, you know, they need this reliable electricity, you know, they want clean electricity and they can sign these massive contracts, 20-year agreements to say,
you know, not just that they'll buy electricity from you, but that they will help you, you know, fund the construction. They will provide prepayments. You know, they'll do anything they can to try and make that power come online and become available. So what we have today, you know, a lot of this excitement and and sort of demand for these startups has to do with the customer changing. So the customer not being the taxpayer or sort of the utility, but being these you know giant
highly profitable hyperscalers who are investing in these companies, prepaying for power and forming these kind of close partnerships.
Slava Rubin (09:24)
Yeah, it's super interesting transition. So that begs to ask, you know, what what are the chances that these hyperscalers actually end up acquiring the power for themselves? I mean, that's an interesting perspective.
Meaning like literally keeping it for themselves as opposed to allowing others to use it. 'Cause right now they're financing it but letting anybody use it, right? and they get to have like, let's call it first right to buy at it. But what are the chances they just take it in house and take that power source to be theirs?
Jan-Erik Asplund (09:51)
Yeah, I think it's a super interesting question. That is definitely possible, especially with the demand that we're seeing from these hyperscalers for data center power. so you have Commonwealth Fusion, you know, I think Google has agreed to buy half of their first kind of you know, actually functioning power plants output. Microsoft has a deal to buy like 50 megawatts. so those aren't quite full on.
full on like buying all the output yet. but I think that that's in the sort of future looking plans of all these companies is that potential I would say. I think Amazon like Amazon I've seen they're talking about gigawatts. and same with meta. And so I think that this is definitely something that that's definitely something we'll see. I think we'll see.
Slava Rubin (10:30)
There's a of pushback about having the data center in the backyard. you know, is that gonna interfere with this power build out?
Jan-Erik Asplund (10:41)
yeah. there's definitely it's it's very reminiscent of the backlash to nuclear energy itself. So it's kind of like a double a double trouble, you know, situation. The data designers need, you know, all this kind of power infrastructure to be to be to bring in the nuclear energy and they use a lot of water. so residents worry about electricity costs going up. so I think it as we talk more about the regulatory stuff, I think this is.
definitely going be key because it's gonna require kind of those, you know, almost like double you know, you have to get over the objections of of of folks for for both the sort of nuclear reactors and the data centers. I think that's probably the main I mean, besides the actual technical feasibility, I think that's the main obstacle.
Slava Rubin (11:21)
Yeah, let's transition this to the next slide, which is really talking about kind of the main type of tech. And this will allow us to dive into what are the risks, whether it be technical, timing, or political, et cetera. So talk to us about the different approaches.
Jan-Erik Asplund (11:35)
Yeah. So fission, you know, start with fission. This is like the conventional, you know, nuclear physics, right? You split a uranium atom, release heat, and then use that to generate electricity. That's basically what terapower and X energy are doing, except building smaller, more repeatable versions of that idea. Fusion is the opposite. You force these light atoms together and that increase that releases this huge amount of energy.
that's sort of you know what's what's happening in the sun. This is something where the potential is huge, but no one is yet operating a commercial fusion power plant. you know, Commonwealth Fusion Systems is the company on our list that's raised the most money, and that's their focus. but again, no one has you know sort of proven that they can run a commercial fusion power plant. Base power is kind of like a slightly you know opposite take, which is
You know, we're not creating electricity, we're actually just, you know, helping the grid use electricity much more intelligently through batteries. And then Panthalassa is is you know a fun one. It's basically instead of figuring out how to bring electricity into a data center that a hyperscaler is using, instead you put the computers, you put the GPUs in the ocean where you have all this natural energy being created by waves, and then you
send the computations back to the mainland from there using that water as power. So these are the four approaches that we're gonna look at. Of you know, there are other permutations of these, but basically these are sort of the core four.
Slava Rubin (13:05)
So the way you would break down the world of energy and powers into these four main categories, is that right?
Jan-Erik Asplund (13:11)
Yeah, exactly.
Slava Rubin (13:12)
How would you rank them in terms of how novel they are, the risk factor, the you know, closest to being commercially viable, et cetera? So how would you rank these four kind of category, not individual companies?
Jan-Erik Asplund (13:26)
Yeah, so I think both distributed storage, aka Base power and fission are known technologies. but distributed storage is much more kind of is much easier to deploy than a new nuclear reactor. So for that reason I put I put that and Base power first. plus they're already, you know, this company is already deploying batteries.
this is not a new new tech. So I think it would be fission next, just because it's a technology we know works. And then I would probably put you know fusion and
Slava Rubin (13:58)
Vision being splitting the atom into two.
Jan-Erik Asplund (14:00)
Exactly. Fission being splitting the atom, fusion being joining them. I'd probably put fusion and load follows power, the panthalassa type approach last because a first of all, we don't know that you know we we don't have evidence of a working fusion power plant, and two, you know, companies like Panthalassa are trying to prove entirely different models that again we don't know.
scale and and are commercially viable.
Slava Rubin (14:24)
Okay, we'll talk about the specific companies in in just a second. What about regulatory risks overarching or to any of these specific four categories?
Jan-Erik Asplund (14:33)
Yeah, I think this is the big one. I mean, all across the world you have
Slava Rubin (14:37)
A lot of
Jan-Erik Asplund (14:37)
A lot of countries have a lot of challenges getting nuclear reactors going. nuclear licensing, you know, getting the permit to actually build has been has been tough. I will say that it does seem like that's getting better. over the last eight years or so. There's been construction permits happening more quickly, reviews are happening more quickly, and so it seems like that's getting better. but
Still a problem. Then there's sort of the fuel. there's all these kinds of like permits and regulations around the specialized fuels that they need to run. there's the data center, the sort of co-location issue. Like there's even there's there's questions about whether data centers and and and nuclear reactors can sort of be located near to each other, which would obviously help a lot with the cost of of
transmission of of moving the electricity around. But that is its own kind of quandary. you have the state and local thing, you know, community boards, town meetings, municipalities imposing these restrictions. And you get enough of those, it makes it really hard to do business in you know, a whole state, as you've seen recently happen with Ohio, as you're seeing potentially emergent Texas.
And maybe just to put the cherry on top, right? Political durability, a lot of the advancements that have come in making these permits faster have come, you know, sort of in the last 10 years. but there's sort of no telling what any future administration would necessarily think. So that is always sort of a potential risk as well.
Slava Rubin (16:02)
Let's double-click on your last line. So obviously, it's been more Republican government or presidency right now. Let's just assume that in November you really start getting momentum from the Democratic Party, and then in two years, let's put in a Democratic president. This has nothing to do with politics explicitly or who the person is, but let's just make an assumption. What happens, in your opinion? Predict the future. What happens
And which of these four categories get hit the hardest if Democrats take over as president and more of the government? I mean it's obviously hard for you to predict exactly, but just give me some perspective.
Jan-Erik Asplund (16:38)
Exactly. Exactly. I can I could pattern match. So I think in defense is a similar kind of always a question mark with how sort of big defense has been in tech and how much closeness there's been with sort of these Republican leaning CEOs at defense tech startups. People were like, when if Biden takes office, right, these companies will all struggle. And the reality that didn't really shake out because so much of the interest in
you know, innovative technology and defense is bipartisan now and is coming from this the the sort of congressperson level at this point. So there's a maybe a slowdown on some of the tailwinds. You know, you're maybe not going to have things be quite as aggressive in terms of moving things through. But I would think if if Democrats take office, you know, you know, unless it's Jill Stein from the Green Party, I don't think that it's going to stop anything.
I would say that the attitude for nuclear demand for it is still there on both sides of the aisle. So I don't think it'll stop it. I think it might, you know, it might make the sort of the the the licensing review process a little bit less aggressive overall. And then I think the one thing about if Democrats win, maybe the one area that could be hurt the most is is the
Maybe fission, you know, sort of traditional fission. because it's a little bit, you know, it's like fusion promises, you know, cleaner energy, right, safer energy, far larger.
Yeah, exactly. Versus versus sort of going back to technologies that you know we we know from you know Three Mile Island and and places like that. So I think potentially you would see a a trend, slight trend against the fission approaches and for the other ones.
Slava Rubin (18:17)
You mentioned three mile islands. So when we're talking the fission with terra power, X hundreds, exa et cetera, we're talking about similar technology to decades ago, right?
Jan-Erik Asplund (18:25)
Yeah, similar similar core technology that they're trying make cheaper cheaper.
Slava Rubin (18:29)
More
advanced, things are better, faster, cheaper, but in in general, kind of similar approach.
Jan-Erik Asplund (18:34)
Yeah, exactly.
Slava Rubin (18:35)
And fusion is something we have never seen before. Correct. Okay, perfect. Okay. what are the chances that some of this just doesn't pay off at all? Meaning no return on investment.
Jan-Erik Asplund (18:45)
yeah, I think it's definitely not it is important to consider that these could basically all go to zero because of what we've just talked about politically, plus the sort of technical feasibility of doing it, plus other sources of power that are out there. I think maybe Base power is the one that I would least expect.
to go to zero because they sort of you know have this existing business they're selling. they have a little over 100 million in annualized revenue. but I do think beyond them, they're all kind of bets on you know fundamentally new technology or new approach to technology. And you know, none of them have power currently online, right? Supplying power to anyone. And so
The sort of go to zero risk, I think, is real for all of them.
Slava Rubin (19:31)
So give me a per category, not per company, the go to zero risk, zero to a hundred percent for the four categories.
Jan-Erik Asplund (19:38)
Nice. I think I think so Base I would say
Slava Rubin (19:43)
No, not per company. Let's go per
Jan-Erik Asplund (19:45)
sorry. Yeah. Yeah. So distributed storage I think is definitely is definitely coming because the need for batteries is so important. And I think it's more of a sort of existing tech tech, you know, optimization problem than anything else.
Slava Rubin (19:58)
What should go to zero on a zero to a hundred percent, it's probably pretty low.
Jan-Erik Asplund (20:01)
Probably zero sector.
Slava Rubin (20:03)
okay.
Jan-Erik Asplund (20:04)
Yeah.
Slava Rubin (20:05)
Okay. So that's pretty low, obviously. What about advanced vision?
Jan-Erik Asplund (20:08)
I think it's also also probably
On the lower side. So maybe, you know, thirty
Slava Rubin (20:14)
And the thinking there is that although at the moment nuclear is trending, it could be politically difficult and maybe the math doesn't work out.
Jan-Erik Asplund (20:22)
Yeah, these companies might not win because of what you just said, but I think it's mostly kind of a again, it's like an engineering optimization, fuel optimization, stuff like that. It it's not the underlying physics are not in question.
Slava Rubin (20:34)
Got it. Have a fusion.
Jan-Erik Asplund (20:35)
Yeah, fusion still has the biggest kind of gap between reality and and theory. So I think you know, I think go to zero probably there's I don't know. I you know, I'm not an expert again, but my ballpark gut feeling would be like sixty, seventy percent.
Slava Rubin (20:51)
Wow. All right. And how about the load follows power?
Jan-Erik Asplund (20:54)
Probably similar, you know. I'm sixty seventy. I guess I'm a bit of an optimist, but I think these are the ones that have the biggest challenges.
Slava Rubin (21:00)
Okay, perfect. Let's move on.
Now let's dive into a couple minutes on each of these companies. So if anybody has any company specific questions, feel free to start dropping them in here. So we've already mentioned Commonwealth a couple of times. They're doing fusion. Give us some more highlights.
Jan-Erik Asplund (21:15)
Yeah, so perfect. They're Commonwealth Fusion Systems is basically building these these two these these two mega projects, right? One is called Spark, and one is called Arc. So Spark is kind of like the proof of concept reactor designed to prove that you can do this kind of fusion power generation by combining atoms and releasing power, and that you can, you know, basically produce more energy than is being consumed to.
to to put the atoms together, which they do through these kind of high temperature superconducting, you know, magnets that are far better than than previous magnets. So if this works, and they are sort of aiming for 2027 to see if it works, then the next step is this 400 megawatt power grid, power plant that they want to build in Virginia, where they're gonna take that fusion reaction they've proved out.
capture the energy and turn it into power that you can you can sell. And half of it will go to Google. And yeah, people are very excited about this company. It's it's sort of MIT affiliated. They've raised billions of dollars. I think the current valuation is somewhere in the is it in the eight billion range. It's unclear, but yeah, they've raised the most money of any company in this space. People are very excited. So they have a huge war chest, but again, not proven technology yet.
Slava Rubin (22:27)
And just so I understand, would their plant be live in twenty twenty seven, or is that only when they would be proving that their fusion works and then they would start building their plant?
Jan-Erik Asplund (22:37)
Yeah, good question. Twenty twenty seven is when the fusion would be proved out and then they would have to build the planet.
Slava Rubin (22:42)
So when we you would think that we would see if there's any power online, is that like twenty twenty nine, twenty thirty, or you're not sure?
Jan-Erik Asplund (22:49)
Yeah, I think twenty thirty seems seems like in line with the other estimates.
Slava Rubin (22:53)
Okay, great. Let's move on to the next one.
Jan-Erik Asplund (22:55)
Great Terra Terra Power. So going from fusion to fission, this is a Bill Gates company. they are using
Slava Rubin (23:00)
Right.
So there's that there's that image in the back of that traditional cooling tower, right?
Jan-Erik Asplund (23:05)
Exactly. Exactly. So yeah, it looks like you expect the main difference is that instead of using water as the coolant inside the reactor, they are using liquid sodium. So that's the main kind of like that's a big difference. And the benefit of that is that you can operate at far higher temperatures without requiring the enormous amount of pressure that you need in a conventional sort of water-cooled electricity plant. So
So that's big for the economics. You can you can store the heat much more efficiently. and then the sort of secondary part of it is the idea is you can you can build this, learn and then build out plants two, three, four, five, ten in a in a very standardized way, and sort of build these modular reactors all across the all across the country. So that's sort of the the theory.
Slava Rubin (23:48)
Do we know evaluation?
Jan-Erik Asplund (23:49)
so I think about four. Four billion.
Slava Rubin (23:53)
Okay, let's
go. Let's go next company.
Jan-Erik Asplund (23:55)
All right, so X energy also fission. but instead of water, they use helium gas as the coolant. So that also allows them to operate at these far higher temperatures, high temperatures that they operate at also create a lot of steam, which has been a selling point for customers like Dow Chemical, because Dow chemical plants consume a lot of steam. So there's kind of this double, you know, double
business potentially replacing fossil fuels in a lot of industrial processes, not just generating electricity. and then they have this kind of other type of fuel, a specialized fuel, and it is you know proprietary to them that they're using it is powerful because you sort of have
a lot of redundancy around containment. You don't need to build this huge containment system around the reactor. You have that in the fuel itself. And so the problem or the opportunity is is great. But then the problem is that we don't have a huge sort of supply chain for that yet. they have Amazon as a major investor and prospective customer in addition to Dow. so that is sort of where they're at right now.
Slava Rubin (24:59)
And their evaluation are they public?
Jan-Erik Asplund (25:00)
X energy, they just went they just started trading. Yeah, just recently. So we do have some some revenue on them. which is, you know, just to be clear, it's like work for the DOE, it's like grants, it's not like nuclear electricity sales.
Slava Rubin (25:14)
Right. So that's like five billion. Right. Okay. Yep. next one.
Jan-Erik Asplund (25:17)
Helion. So you know, this is again a fusion like Commonwealth. Sam Altman's an investor. So a bit of a different approach from Commonwealth fusion systems, where you know Commonwealth is building this kind of
Donut shaped magnetic bottle that's producing power. Helion's approach is kind of like an engine. They're creating these blobs of plasma, accelerating them towards each other, colliding and getting these reactions. And then, you know, the plasma is expanding. They're creating this huge magnetic field that's changing, and then they're extracting electricity directly from that. So it's to kind of put it simply, I think.
Commonwealth Fusion Systems looks like a traditional power plant, just using fusion. And Helion is building something a little bit more out there, more experimental. They have proven out the fundamental model, you know, to an extent, but they're still in the works building a machine to sort of generate electricity that can be consumed commercially. They haven't
They're in the same position as Commonwealth, essentially, and not having proven the ability to generate net new electricity from fusion, to be clear. so there's a Microsoft contract in the works. They're in Washington State, where they've had some you know success on getting regulatory approval to build. so it's kind of like Commonwealth, but a little bit more far afield in terms of technique.
Slava Rubin (26:37)
I mean, crazy thing is their valuation is on fire. so in twenty twenty one, sorry, in twenty twenty, as part of COVID, let's call it, they raised a little over at a billion. Now they're at fifteen and a half. Last round before this was five, just like a year and a half ago. So this whole, let's call it Republican leadership slash momentum right now has been very significant for them. So you could have practically fifteen extra money p on paper.
in the last five, six years. So this one is the most expensive I think that we have in the list, right?
Jan-Erik Asplund (27:09)
Yes, that's yeah, definitely. A little bit more than Base power.
Slava Rubin (27:12)
Exactly. Next slide.
Jan-Erik Asplund (27:13)
Great. So Base power, that's definitely the easiest one to understand and for me to explain. they put a big battery outside your house, as you can see here in the picture. And then you have backup electricity for the power goes out. but also Base power controlling tens of thousands of these batteries. they have something that kind of behaves like a like a power plant. And you they can tell the entire fleet of batteries, you know, to
charge or or discharge right now. the the way that you know you would be able to if you ran a power grid. So they are you know it's it's kind of more of a traditional kind of utilities play. but the whole idea is they can charge the batteries when power is cheap. They can discharge them when power is relatively expensive. They sell into utilities who you know want to be able to use some of Base power's battery power when the grid needs it.
So it's a it's a cool company, and you know, the speed is a really big thing as we're talking about these three to eight year timelines. you know, Base just has to come to your house, install a battery. It takes a day. you know, it's very straightforward. valued at 13 billion, like we said. So it's still quite rich given you know, just wanna make sure I had the most recent number on Base.
It's 12 million in annualized revenue as of the end of 2024. I think they've increased a
Slava Rubin (28:28)
Same quite.
Jan-Erik Asplund (28:28)
bit in 2025, but still I think it's the most conventional business model that we have probably seen here, but definitely one people are excited about.
Slava Rubin (28:37)
Zach Dell is Michael Dell's son of Dell. so that's just something to know. Apparently they had their seed round in August 2023 at a 44 million post, 44 to 300 to 841 to 4 billion, and there's that triple from 4 billion to 13 billion, because now power's sexy. why isn't Generac doing this exact same thing? Because, you know, isn't Generac kind of like the well known.
provider for these types of products for the home, you know, just like if your power goes out.
Jan-Erik Asplund (29:05)
Yeah, they they do have they do have programs that you you can get a extra battery, extra generator through Generac. You can actually do this and they will aggregate those power cells. and they even work with with utilities and grid operators to do some of this. you know, the so it's not a business model that's entirely unique to Base. but they're just not doing it, they're not going full in a hundred percent on this, right?
They will sell you an extra battery. they're a hardware manufacturer and they have a network of dealers and distributors that they work with. And so they'll sell you an additional one. but Base power is you know, is is doing something completely different, which is they keep the battery itself on their balance sheet. They own it. so they're capturing the economics instead of or selling a one-time hardware sale.
Slava Rubin (29:50)
Interesting. Interesting. Next one.
Jan-Erik Asplund (29:52)
Cool. Yeah. Probably the most, you know, kind of creative option on the list. You know, the point of Panthalassa is basically you know, you have this incredible amount of energy being produced in the ocean all the time from waves. And if you want to get that energy back to shore, which people have done, you need these giant cables under the sea and they're very expensive. So their idea was don't bring the electricity.
back to the shore. Instead put whatever you need powered out in the in the ocean in these sort of large structures, you know, which which are shaped like these these nice balls. And you use the movement of the waves to power an internal turbine, create energy. you pack it full of, you know, these days you pack it full of GPUs and the seawater flowing around them helps cool the whole thing down. so you basically have a data center out at sea.
powered by the ocean. Now that's amazing. I think very, you know, plausibly, extremely environmentally friendly. The problem is, you know, sort of the ocean. saltwater is corrosive, you have storms, you know, you have the same kind of problem as with space data centers, which is when something breaks, you have to go out into the ocean and service a floating platform you know, in the Pacific. So that's considerably more annoying than driving down the street in Virginia.
So anyway, they've done multiple rounds of testing. their their pilots are ongoing. So this is one again where they've made progress towards sort of the proof of concept, but we don't yet have sort of commercial customers' commercial evidence of it of it working yet.
Slava Rubin (31:21)
And this I believe is like at a billion posts right now.
Jan-Erik Asplund (31:23)
Yeah, one or two in in progress, I think.
Slava Rubin (31:25)
do we have any other companies we want to cover?
One that I would ask about is Valar that's been trending, that's really more kind of the micro nuclear. Can you comment anything with Valar?
Jan-Erik Asplund (31:36)
Yeah, Valar. So they slot in with X Energy and Terra in that they're doing a sort of advanced modern form of fission, just in a more, you know, aggressive startup style of deployment. you know, what's cool about Valar and what you what you can look into is that they built a reactor in Utah, Ward 250, which achieved criticality in June. So, you know, this was a Department of Energy pilot.
And they sort of they proved that a small reactor works is obviously very different from proving you can power, you know, gigawatts. but it it's it's they move very fast. So it's a cool one. They're a cool one to watch.
Slava Rubin (32:14)
sorry, quick quick correction. So Panthalassa also apparently just raised at a five billion dollar round. There's talk of higher. Valar last raised, I believe, at like six or let me check. in the meantime, what is the difference between Base battery and having like a Tesla battery system?
Jan-Erik Asplund (32:32)
yeah, yeah. Good question. Because I think, yeah, Tesla also has the PowerWall. they they released the Power Wall at Tesla and then the virtual power plant. And so the idea there was something very similar, which is aggregating all these home batteries. now the difference is there that Tesla they generally sell the homeowner the powerwall. So it's similar to Generac, you know, you
You as a homeowner buy it and then you can opt into these utility programs to get some kind of compensation. so similar to Generac, whereas Base is more like they own the asset.
Slava Rubin (33:00)
Got it. give me one second. Got a lot of moving parts here between questions and the deck, and what would you I'm gonna put you on the spot here, which is gonna be a bit difficult because we just covered a lot of companies. We covered helium, we covered Commonwealth, both similar types of fusion companies. We covered Terra, we covered X Energy, Valar, Fission Companies.
Covered Base and panthalassa. So seven companies. Can you order them for me? What's your one through seven in terms of how much you like them at the price? Helium at sixteen billion, Commonwealth at eight, TerraPower at four, X Energy at five, Base power at thirteen, panthalassa at five, and Valar at six.
It's lot of that's a lot of companies and numbers.
Jan-Erik Asplund (33:43)
Yeah,
you know, Terra power, I think TerraPower at four, you know, a lot of this is is can you get access? But I think if you can get access, then I like TerraPower at four or whatever it's at. because again, I think it has a low chance of going to zero. I think we need fission, we need nuclear, we need energy. Fission's known. So I think TerraPower one, maybe X energy two, if I'm sort of being just very logical.
I think my left field, you know, sort of contrarian opinion here maybe is Commonwealth at three, because I think they have an incredibly impressive team and a lot of momentum and a lot of, you know, backing. to where I think and I don't know the feasibility of fusion, but if it's gonna work, I would imagine that they have a good chance of figuring it out, having been working on it for the longest, having the most money, having, you know.
the the sort of level of team they have. Base power maybe next. I think the valuation is really high for what it is, like you, like you alluded to, but you know, it's an exciting business. I think batteries are almost as big of a need as nuclear in general. So I think it's it's it's a great industry to be in. And then I put maybe maybe Helion next because of the valuation. And then Anthalasa would be my last one, just because I'm yeah, I don't know. I don't understand
If it's necessarily how feasible it is. So it's hard to
Slava Rubin (34:59)
Would you throw valor in there? Is it in
Jan-Erik Asplund (35:00)
With
Slava Rubin (35:01)
the in the one cell or the
Jan-Erik Asplund (35:03)
It it's probably up maybe in between them. maybe in between them, just 'cause they're like Terra Powers valuation. And you said valors at six. So yeah, I think I think in between them.
Slava Rubin (35:11)
I agree with a lot of things that you're saying, but I'm gonna go with Helion over Commonwealth even at the higher price. and I agree with you with Base power being expensive. and personally I think Valar has a lot of opportunity to get a lot of momentum with the micro opportunities at even though it's already at a six billion. but I agree with a lot of what you were saying. All right.
Let's see, we got some questions coming in. Man, questions are coming in high and heavy today. So we have some questions about criticality. Can you mention what that was, what that is?
Yeah, so just what is criticality and apparently four like there's four companies that have reached it. Can you just speak to those two points?
Jan-Erik Asplund (35:44)
Yeah. so essentially criticality is when you have successfully managed to create a sustaining nuclear reaction. So each reaction generates, you know, another reaction generates another reaction. So you have sustainable sort of electricity being generated. So the the step one to proving you have something you know that's commercially viable. and
Slava Rubin (36:06)
Yeah.
Jan-Erik Asplund (36:08)
Exactly. yeah, fusion, yeah. You don't have a criticality with with that. but yeah.
Slava Rubin (36:13)
Great. so yeah, there's been like four companies that have achieved it. in the last bit. There's a question, do you know Blue Core?
Jan-Erik Asplund (36:19)
it definitely rings a bell from
Slava Rubin (36:21)
poor dot energy but okay if you can't speak to it off the top of your head that's okay. we can't know everything.
Jan-Erik Asplund (36:26)
Right.
Slava Rubin (36:26)
exactly, exactly. All good. What do you think about the micro nuclear reactors like Valar versus the bigger ones? What do you think about that kind of market?
Jan-Erik Asplund (36:35)
Yeah, I think clearly they've shown that you can use the sort of you know the micro approach to build faster, potentially have these more modular you know outputs, I think really exciting. I anyone who's sort of innovating on fission, I think, you know, doing is doing cool stuff here. so I think it's really cool. I think you know there's still a lot of stuff to prove, but if you can make it successfully generate.
commercial electricity, then you have something that can be produced sort of at a factory, right? Almost like a Tesla factory or or whatever. much easier than producing a regular size nuclear reactor. So that's probably what's the most exciting is is sort of scaling up in that way.
Slava Rubin (37:08)
We're living in a crazy future if we're gonna having reaptors being built like Tesla cars. That'd be wild. Let's go to the next slide.
So talk to us about what the future could look like here.
Jan-Erik Asplund (37:17)
Yeah, so I think the bear case, you know, this very dramatic dark photo on the left is basically that, you know, a lot of these projects we've been talking about, you know, flip, whether for technical reasons or for regulatory political reasons. And we end up in a future of twenty thirty where we have still a lot more data centers that are trying to get built, but we have gas, solar, you know, existing nuclear plants doing most of that work for for
whatever reason. And these companies are are going to be struggling to raise at these valuations, you know, these kinds of re-rates again, if that happens. I think the sort of Base case, maybe the most feasible case to imagine, is that, you know, these companies continue building. You see the fission companies doing their first sort of commercial projects. you see distributed batteries taking off even more. and I think
unfortunately with fusion. I'm not sure if the Base case involves fusion happening. Maybe there's meaningful technical milestones, but not yet, you know, major power plants, I think, on fusion. I think that's more basic but that's more bull case. you see commercial electricity on the grid in 2030 from Commonwealth or Helion. and also in bull case would be companies like TerraPower, X Energy,
and and these other fission valor doing this kind of standardized manufacturing, you know, where they're producing the second and third power plant or third power plant reactor easier, faster than the first ones. And you're starting to see this glimmer of this kind of industrial manufacturing of reactors. so yeah, fingers crossed
Slava Rubin (38:50)
You have here the hyperscalers create a private market for a new generation. What does that look like?
Jan-Erik Asplund (38:55)
yeah, so it's basically that you, you know, are not relying on on public utilities for this stuff. You are basically selling into infinite demand, which for any of these companies, you know, if they can make it work, that will be really huge for growth for the inflection of growth because you'll not be selling to taxpayer money or you know, going after taxpayer money, you'll be selling into Google, Microsoft Meta, which will be willing to basically fund the generation.
the the the building, they'll be able to sign a 20-year contract, take all your power. It's just like having a completely captive, you know, audience of buyers who will be, you know, your best partners in sort of scaling out. So that will be a key, I think, to the bull case.
Slava Rubin (39:34)
In that situation, am I buying it from like Terra power or am I buying it from Google? The power?
Jan-Erik Asplund (39:39)
That's an interesting question. I would probably tear a power i if Google's not taking the entire reactor, although I think that will be a big phenomenon for a lot of you know, sort of first wave will be paid bought and paid for by Google. or maybe they'll take half and then the the other half will be through the utility. So you'll pay the utility.
Slava Rubin (39:56)
There's a question, what's the best venue to get exposure investments in these companies? We've talked about all the various ways to do that in other episodes. So if you can listen into those, that'd be great. in the future, if fusion does work, does it kill fission or do they both have a world a place to live in the power supply?
Jan-Erik Asplund (40:13)
That's a great question. because it seems like just better overall. I think the main thing you would see is that new build of fission would would slow down. you would basically why would you fund and finance fission if you have fusion? but you do have existing fission projects, you know, all over. if they can keep them running safely at low operating costs, you know, you wouldn't be shutting them down. It would be more like a competition for the next.
Yeah the next project, which I think you would definitely see utilities choose and these hyperscalers both choosing. so I think long term, yes, fusion would win, but it's not gonna, you know, decommission every fission reactor overnight.
Slava Rubin (40:50)
So, second order effects, what do you think about uranium prices? So uranium has had quite the run in the last five years. And similar but different to that, do we think there's gonna be a second run there? And similar and different, what do we think about nuclear waste and investing into nuclear waste, nuclear recycle, you know, emerging the recycling market, et cetera, et cetera?
Or any other second order effects.
Jan-Erik Asplund (41:13)
one I think so to maybe look at nuclear waste first, I think there's it's kind of like a picks and shovels. I think it's a great potential investment. I think it's definitely somewhat narrower as an investment. but yeah, there's a few public companies that are working on this. There's some startups that are working on this. Oclo, which we didn't mention too much, but you know, they are.
working on a project of recycling used fuel into fuel for their reactors. So I mean the main thing is we know kind of how to store spent fuel already safely from from what I've seen. So I'm not sure that it's as big a market. because it's it's not the really the main barrier to to producing more nuclear reactors at the moment. So
Slava Rubin (41:53)
What's your thoughts on uranium?
Jan-Erik Asplund (41:54)
slightly tough to say, I think you know the bull case is clear for it, right? If we're restarting existing reactors, if we're building more, then we are increasing our need for uranium. And so I could definitely imagine the price coming back up. I think also I think I mean I'm sure I think a lot of it it comes from Russia and other places in that part of the world. I think
to the extent that we're trying to reduce our dependence you know on on on those kinds of suppliers for these kinds of important you know inputs, I think that could have upward pressure as well on the price. So but yeah, I'm not an expert.
Slava Rubin (42:25)
Perfect. We've covered a ton of ground, seven companies, all kinds of directions and angles on power, nuclear, energy, et cetera. Thank you, Jan Erik very much. And thank you, everybody, for joining. The questions keep on coming in hot and heavy, so clearly people are interested. But that's a wrap for today's episode. Have a good rest of your day.
