Bill Gross, Founder, Chairman and CEO, Heliogen; Founder and Chairman, Idealab 

Interviewer: Michal Lev-Ram, Editorial Director, Fortune Live Media; Editor-at-Large, FORTUNE 

 Brainstorm Tech Dinner 2023: Keynote Interview with Bill Gross

Conferences

Bill Gross, Founder, Chairman and CEO, Heliogen; Founder and Chairman, Idealab
 Interviewer: Michal Lev-Ram, Editor-at-Large, FORTUNE 

 Keynote Interview with Bill Gross

tonight we are joined by scott mentioned serial entrepreneur climate advocate and a whole lot of other things I could use to describe you go ahead and have a seat bill bill, gross bill is no novice when it comes to climate tech in high school. He started a company selling solar energy panels. Uh, and uh, now just a few decades later he's still trying to do it. So um, thank you so much for joining us bill. Um, okay, first question for you, you've said that climate tech is having its Netscape moment. So so tell us about that. Why are you convinced that this is the case? Well, we're really at an inflection point for climate tech but in all of history, 2022 is going to go down as the year where everything changed through the combination of the things you heard the war, the fossil fuel prices, inflation reduction act, all the commitments that companies like all of yours are making, but also because of the cost. Finally, climate tech is a money making opportunity. It was always about mitigating risk and now it's about capturing opportunity. So that turning point is just so exciting to be a part of like what are the odds that we would all be alive at that moment in history where we make the turning point from burning things to get off our energy to making it renewable and it's really happening right now. It has to happen this decade. So I'm so excited about it and the analogy to the Netscape moment was I remember in 1995 when Netscape went public, that was one of John doors first hits. The browser had 30 million users. Remember how little that sounds now, just billions of users now who are connected to Internet. But 30 million users sounded incredible and it was exploding. Everybody rushed into the internet. Everybody rushed in to learn how to evolve and make new instances of new companies and new ideas and look what happened. It was, it was a revolution. This revolution we're now living is gonna be way bigger than that because it's energy, it's, it's everything that powers our whole planet. It's all of our materials, everything around us has energy in it. Like the metal, the wood and everything is just energy embedded in it. So we're remaking the entire energy industry. So it really is an incredible time and it's an important one making the entire energy industry. I know we have people in this room who are involved in that transformation. Um, it sounds expensive. I know it is expensive, but you also have a lot of data points uh, show showing not only why this is a great opportunity for investors but that the cost has gone, you know, the effects of more moore's law here. So so give us some numbers, the costs have come down so much. I think all of you have seen the learning curve numbers on solar panels and on wind energy and so on. They've gone through dramatic declines over the last two decades, importantly the electrons you can now make from the solar panel are the cheapest electrons in all of human history there. Three times cheaper than you can make electrons from natural gas. And they're finally a way to save money. Oxford did analysis of how much money we would save by making this energy transition. It's $12 trillion 2050. So all the people who are giving disinformation about this is going to cost more. Just have it incorrect. They don't understand. It's actually already cheaper. We have lots of other challenges to solve to get those cheap electrons everywhere. We have to have storage problem, solve storage issues, we have to solve transmission issues. But fundamentally we can make the energy cheaper than burning things and the idea that we live with the geological lottery right now where someone who's lucky and happens to have the fossils underneath the ground is the one who has the energy. It's liberating. It's almost freedom energy to be able to take the energy from the sky and from the air and it's much more uniformly distributed. So everybody benefits if we make this transition as well. Um, so I was telling Bill that I am a crazy person who actually drove to las Vegas, anybody else here? I drove here. Okay, Another, another person from the Bay Area. No, and um, and I, I was so struck by this, it's solar thermal, right? A solar thermal farm. Um, Ivan pa, which you see as you enter las Vegas by car. Um, and it's just it's massive. And so you were telling me about how, when this was constructed, which is not all that long ago, it was not, you know, widely supported. There were even environmentalists were against it because they had to move some desert tortoises which we will get into. Um, but, but talk a little bit about just the transition from that period to today. Yes, well, I gave it 10 talk in 2015. So it's already eight years old on timing, but it's still relevant and it's, I looked at 100 and 50 companies that we started since 1996 and 60 of them failed, 90 of them succeeded, but six of them failed. So I really tried to look at what was the cause of the failure and more than almost anything it was timing. It was not the management team, it was not the inability raised capital. It was not the idea, timing dominated. So, so many things matter and succeed if the world is ready for them. So that Ivan Paul project was built between 2005 and 2012. It's 3700 acres. It was $2.2 billion it was built to solve a utility problem, not to solve the climate problem. By the last decade though, the prices have come down by using computation by using moore's law, by using ai in the systems. We've been able to reduce the price at this company that I run right now. He legion, we've taken that idea of Ivan pop, but so dramatically reduced the price by making a factory made and by using computation that now we can beat the price of fossil fuels back then. It was a premium. It was three times more expensive than fossil fuels back then when electricity cost 10 cents a kilowatt hour, cost 27 cents a kilowatt hour. So, it was a beautiful project to demonstrate the technology and the Department of Energy helped fund it, but it just wasn't cost effective. Fast forward to today. Now, electricity prices are more than 10 cents a kilowatt hour and now we can make the electricity for six cents a kilowatt hour. So it's half. So that change makes the timing right today. And it really, really matters to have timing just right. I was talking earlier about uh, incredible. Uh, woman here who is the founder of the, who ran Saturn for the, for the G E E V one car. That was an amazing car. But it was way too early. And look at what's happened with the world being ready for electrification of vehicles now and it's, it's hard, you can't control timing, but you can assess it, you can see if the world is ready. And one thing I've learned is to try and survive until the timing is right. So try and make your cash last long enough until people are ready for it. And that really has, has been a tough lesson to learn but but a valuable one. So another thing you innovated with your current company, hilly again, as I mentioned regarding the tortoises because I'm sure you're all dying to know and birds. So so tell us about that because it is, it is kind of cool and that was an example also of a learning from that project. So on that project, if you ever seen it, it's it's not too far away from here, it's three huge towers with thousands and thousands of mirrors shining light up to a cylinder at the top of the towers. Well it gets so bright out there, you can't even look at it, but there's a very big hot spot all around where if a bird flies into that hot spot, it would overheat before it can exit. So there were a lot of birds that died at that at that site. And before we built anything we wanted to study that and learn how to make sure we didn't kill any birds. So the solution we came up with to solve that was to make a quadrant of the field, not a full surround field and make a smaller focus so that if a bird flew into that, that area, they could exit in time. And by doing that, we solve the problem. We had to work with the Audubon society to prove it. We tested it, we proved it. And that was valuable learning from that experience. Nobody knew about that before that plant was built. But we really learned a lot because that plant cutting new ground for us and this is the same thing. Uh, that's why you all came here. Well, this is a big problem with solar projects. Solar projects take land. If you don't want to disrupt the migration of animals, you don't want to disrupt the land. So we came up with a way at the legion to make a product which just gets installed on the land with no ground penetration. And by making no ground penetration, no new roads, no new aisle ways the animals can move in their normal migration patterns again, trying to be sensitive to the environment, but still using the power of gathering energy over a large area. Okay, what are you most excited about? Where do you see the, uh, if you were just purely investing today, what are the untapped opportunities or the tapped opportunities where there's still a ton of room for growth within the climate tech sector? Well, there's so many. My view is we need 100,000 shots on goal. Let me tell you what I mean by that 100,000 shots, one goal in hockey when you make a shot on goal. Well, you can't make a goal unless you take a shot. And and hockey uh, the average is 10%. Almost always. It's a little bit higher than 10% for some players, a little lower than 10%. But a shot on goal, 10% gets converted. So if we make 100,000 shots on goal and 10,000 of them succeed and each one of them can take out about five million tons of CO two. That would eliminate all 50 gigatons of CO two that we admit. So we need that many efforts like so, so there's so much opportunity. It's ridiculous. So my own 10 companies are only 10 shots, but we need many, many more things than there's opportunity everywhere. There's so many opportunities. It's crazy. But that's how big a problem it is. But that's how big the opportunity is. And uh where I see the biggest chance to make a difference is with technology and in particular with AI and robotics. So in we all know from the devices in our pockets that computation Has gone down in price more than anything else in history. And just to give some numbers, I think all of you would know this. But these numbers staggered me when I heard them in 1984. If you wanted to buy a gig a flop of computing power. So Giga flop a billion operations per second. You buy a cray supercomputer for $46 million dollars today, you can buy a giga flops computing power in a Sony playstation for four cents. So it went from $46 million to four cents. Nothing in history has ever gone from $46 million to four cents. So how do you take advantage of that? Well, everything in our lives has taken advantage of that has gotten cheaper in price and we know we know that from all our devices, how powerful they've gotten. So how do you use that in climate tech? Well, you need to use that moore's law advantage in everything you're thinking about in climate tech. You need to use it to use ai to make everything operate more smartly. I was talking to someone from from auto grade earlier about using ai looking at weather patterns, looking at prediction of charge cycles. You need to use smart everywhere because that's smarts are migrating towards free. So if you have something migrating towards free, you have to use more of that. How do we do that at the legion? We put up a big field of mirrors the way everybody else does them is they make them super stiff and super accurate because they need to be very stiff and accurate to point the sunlight direct spot. How do we make them cheap and lightweight? We make them simple and cheap and light but then we use computer vision to make them accurate. So we use software to make them accurate? As opposed to hardware? And the more software you can bet in something to me make it smarter. That's the angle for the future. That's how you beat fossil fuels. You dig out of the ground and you burn them. It's like the lowest cost of goods you could possibly have, like the only cost of fossil fuel is if you're above them and the cost of moving them from where they were to where you are. But the cost of the ship that goes from Saudi Arabia to the port of Long Beach. But other than that, the cards are basically free. So how do you compete with that? Will you compete with that with moore's Law which makes things which makes computation basically free. So that's I think moore's law is the secret weapon for climate change. To have a chance. Do we have a question from anybody in the audience here for bill, raise your hand, we'll bring a microphone over to I think there's one over there, there's a bright shining light in my face. Um we're bringing it, we'll bring a microphone over to you if you could just introduce yourself. Thank you. Hi Suzanne from Invisible technologies. Great talk and totally agree that you need to be using smart to make smarter decisions. Uh question is around getting the data to leverage ai So a lot? A lot of companies are taking a first step here with sustainability. How and where do you advise them getting the data to begin these projects at the same time that the computation is getting cheaper, sensors are getting cheaper. So we look at putting sensors on everything and I love the fact that you can put cheap cameras everywhere, cheap microphones everywhere, cheap pressure sensors, temperature sensors everywhere and just buy gas, gathering that, just getting logs of that. But then using ai to make smart analytical decisions out of that, using machine learning to train it to make the system perform better, I think it's just a staggering opportunity and it's perfect for all the types of companies that are here tonight and I just think there's so much that's yet to be done there. And again, when I'm talking to him earlier, think about this, when you make a smart decision with data, the cost, the incremental cost is so low. After you've written the software because you don't have to have the Capex of making new hardware change, you're just making the existing hardware run more intelligently. So I think there's so much leverage there. I think that's gonna be a big, big factor. Okay, last question for you bill, uh we mentioned that you started your first company in your first solar company in the 70s in high school, was that good or bad timing? Well that was bad timing, but but I'll tell you how it how it taught me a lot of lessons. So uh it was 1973. I grew up in the San Fernando Valley in Los Angeles. The Arab oil embargo struck after the seven day war in Israel. And uh gasoline was being rationed. Thank you, thank you. Uh gasoline was being rationed, gasoline was being rationed and on Ventura Boulevard, there was a mile long line to buy $5 of gasoline on odd or even numbered days based on the last year license plate. So my mother could only buy $5 of gasoline every other day. And I was going to high school and in Van Nuys and she didn't have enough gas to take me to high school in Van Nuys. So I ride my bike to school. So I rode my bike eight miles to school. And while I'm riding in the cold, I'm thinking why is it that someone else in the world can decide to cut off our energy supply and give all these people so much hardship. I didn't know anything about climate change. I didn't know anything about solar energy. I didn't know anything about the world. I was 13, 14 years old, but I I really was uh thinking it's unfair. So I would go to the library after school and read everything I could about alternative energy, renewable energy. I was reading in popular science magazine, Scientific american. I was reading about this thing called solar and wind and all the resource that you can take advantage of. So I started making little concentrators out of tinfoil at first and then out of metal I took metal shop started making and I was reading the magazines and saying I can sell these in the back of the magazine. They had little ads in the back of the magazine. I took ads in the back, I sold plans to make these things for $4 and I sold 10,000 plans and I paid my way through college with that. I got accepted. Yeah it gave me a taste of entrepreneurship. It gave me a taste of intellectual property like I could use my brain to make something that other people wanted. It got me accepted to caltech I think because I wrote about that on my application and it gave me a lifelong passion for this. But then after I got accepted to caltech and I started college I continued the mail order business for a little while and then everybody lost interest. Reagan got elected, he tore the solar panels off the roof of the White House. Uh the the the the oil embargo ended and gasoline was flooded at cheap prices. Nobody cared about renewable energy anymore. So I took a 20 year detour in software, learned about software started, software companies sold a company lotus sold the company to yahoo had a really, really great time learning about software and then right after the dot com crash I really had to do a reassessment of what do I want to do with my life and my real passion as a teenager was really doing something that mattered to the world and now I have the resources. Now, I didn't have just a little tiny at the back of proper science, I had some successes behind me so I could actually start companies in climate area. So that's all I've been doing ever since. I really come full circle. Well, Bill, thank you so much for joining us tonight we couldn't have thought of.