- Nuclear fusion will be here within three years…
- China is putting 1,000 driverless taxis on the road…
- Something unusual happened in this company’s latest raise…
Thank you to those who joined me for our Silicon Valley “Unlocked” event last night.
We are living in an age of rapid technological development, driven by some incredible early stage companies. This should be the best climate in history for investors.
But it hasn’t been.
After the internet bubble burst, the game changed. The “insiders” figured out a way to keep the best deals and the best gains to themselves. Normal investors have been all but locked out.
Meanwhile, the venture capitalists and private equity sharks have feasted upon massive gains by keeping the best tech companies private for a decade at a time – sometimes longer.
My goal for the last seven years has been to change that.
I’ve been on a mission to find a way to bring the best early stage investments to my readers… Companies with the potential to bring everyday investors life-changing gains.
And that’s why I went back to the Valley for the first time since COVID-19 hit. It was all about compiling a list of “Penny IPOs” trading at valuations that are lower than where the private investors got in.
In other words, these are exciting tech companies that we can buy at a better price than the insiders. That means this is the one area in the market where everyday investors can still reap big gains on publicly traded stocks.
And hardly any investors know they exist. At least… until last night when I unveiled the “list.
So for anyone interested, but unable to attend our Silicon Valley “Unlocked” event last night, I have asked my publisher to make it available to readers of The Bleeding Edge for just a few days. Just go right here for the replay.
And thank you again for taking the time to read and enjoy The Bleeding Edge.
Now let’s turn to today’s insights…
The biggest nuclear fusion deal to date…
Vancouver-based General Fusion just announced a major deal with the U.K.’s Atomic Energy Authority (UKAEA). Per the partnership, General Fusion will build and operate a nuclear fusion reactor on the UKAEA’s Culham Campus.
This is one of the most exciting developments in the industry to date. And General Fusion is one of the most promising companies in this space. I’ll explain why in a minute.
But first, let’s bring newer readers up to speed on fusion technology.
Nuclear fusion involves taking two separate nuclei and combining them to form a new nucleus. This produces an enormous amount of energy. And it is 100% clean. Unlike nuclear fission, forms of nuclear fusion produce no radioactive waste.
And there are different technological approaches to building nuclear fusion reactors. We don’t yet know if there will be one predominant way, but I’m excited that the industry is developing so many different approaches.
General Fusion’s approach is called Magnetized Target Fusion. It entails generating a plasma reaction in a spherical reactor at extremely hot temperatures – temperatures that are hotter than the Sun.
The reactors can be developed in a way so that they are compact. And they don’t take immense amounts of space and money to build. We can think of these compact reactors as being powerful enough to feed 100,000 homes.
This would allow us to build a decentralized network of fusion reactors. That would in turn create an energy grid that is far more resilient than the more centralized power grid that is typical of what we see today.
Of course, that’s if the technology can be deployed economically at scale.
That’s why General Fusion’s deal with the UKAEA is so important. It will enable the company to build a reactor, get it up and running, and then assess whether the benefits outweigh the costs.
If so, all that’s left to do is build more reactors. General Fusion would have no problem securing the funding it needs once its technology has been proven.
In fact, the company already has an impressive list of backers, which includes Jeff Bezos – and yours truly. And I even got in at a better price than Bezos on this one.
And perhaps most exciting, this deal is moving at an accelerated timeline. General Fusion will start building its reactor next year.
From there, the company expects to have the reactor operational within three years. It should be fully functional by 2025.
As we’ve discussed before, this is more evidence that nuclear fusion is coming much faster than most people realize. This technology isn’t something that’s a decade or more out. It’s in the near future.
We are no more than a few years away from the first fusion reactors producing more energy than that required to power them. That means limitless, clean, and essentially “free” energy for all.
The race for autonomous vehicles is on…
Big developments in the autonomous driving space just keep on coming. This time, the news is from China.
Chinese tech giant Baidu, which is basically the equivalent of Google, just announced plans to put 1,000 driverless taxis on the road over the next three years.
And what’s interesting here is that Baidu’s approach mirrors Waymo’s. Like Waymo, Baidu isn’t interested in making its own cars. Instead, it is developing the self-driving technology that will serve as the car’s operating system.
To that end, Baidu is partnering with BAIC – one of China’s largest carmakers. BAIC will manufacture the cars that use Baidu’s tech.
Unlike Waymo, Baidu has not been shy about this. The company has explicitly stated that it intends to license and sell its self-driving technology. The goal is to get its operating system into as many cars in China as possible.
As we’ve discussed numerous times, this is Google’s goal for Waymo as well. The difference is, Google has been quiet about it. That’s because Google doesn’t want to raise any red flags with regulators. That could potentially lead to antitrust issues.
Baidu doesn’t have to worry about that because it has close ties with the central government. And BAIC is itself a state-backed company.
And get this – Baidu is calling its self-driving technology “Apollo.” And it’s calling its self-driving cars Apollo Moon cars. That’s curious. Could this be a little poke at the U.S. given the ongoing space race between the two countries? It’s pretty funny actually.
Regardless, the race for self-driving supremacy is now heating up. It is no longer just a matter of companies competing against each other, but countries racing to establish a leadership position in the multitrillion-dollar automotive industry.
We can expect to see a lot more developments in this area in the second half of this year.
Anduril is on the rise…
We haven’t checked in on Anduril, one of our early stage watchlist companies, since last July. And it’s time for an update with its latest round of funding.
Anduril just raised $450 million in its Series D venture capital (VC) round. The company is now valued at an impressive $4.6 billion.
For the sake of new readers, Anduril has become a prominent high-tech military contractor. The company developed an amazing suite of technology that uses artificial intelligence (AI). This AI powers autonomous drones as well as solar-powered surveillance towers.
And there was something highly unusual about Anduril’s Series D round. The raise was not led by a VC firm. It was led by an individual – Elad Gil. Gil is a tech executive who founded Color Genomics. And before that, Gil was an executive at Twitter.
As I mentioned in yesterday’s issue, the general rule of thumb is that whoever leads a VC round typically invests at least half of the total raise. That means Gil likely put up at least $225 million to invest in Anduril. Talk about a vote of confidence…
This is not the way venture financing is usually done. It’s almost always a major VC firm or other institution leading the round. Then, other VC firms, private equity firms, strategic capital from industry, or institutional funds fill out the round.
And Anduril isn’t lacking prominent VC support. Heavy hitters like Andreessen Horowitz, 8VC, XYZ Ventures, Founders Fund, and Lux Capital are backing the company.
So I wonder if we might be seeing a shift here. We could start to see successful executives become one-person VCs to drum up financing for their favorite early stage companies. No venture capital firm is necessary. This is absolutely something I’ll be watching closely.
And we should keep an eye on Anduril. This is a highly disruptive entrant into an industry that was largely controlled by large legacy-incumbent contractors and technology companies.
Anduril’s technology is shaping what modern defense and warfare will look like… And it will save a lot of lives in the process.
Editor, The Bleeding Edge
Like what you’re reading? Send your thoughts to [email protected].