Investor Andrew Beebe talks AI-fueled geothermal and ‘the edge of the possible’

A lot of climate tech investors are still trying to figure out how to invest in artificial intelligence. Will it become a unique investment category? Or just a natural enhancement of what many startups are already building?

There’s an emerging class of startups with AI at the center of their business. Citrine Informatics is using generative AI to speed up discovery of new materials; Koloma is using AI to identify potential sources of geologic hydrogen; and Zanskar is using AI to accelerate and de-risk geothermal exploration.

Andrew Beebe, managing director at Obvious Ventures, thinks that AI is pushing the “edge of the possible” in climate tech. He recently led a $30 million Series B round for Zanskar, calling it “generative science at work.”

“I think generative science is the next phase…it is going to shorten the distance to some of these massive solutions,” in batteries, solar, nuclear, and geothermal, said Beebe, speaking on The Carbon Copy.

“Zanskar doesn't have special drilling technology," he added. "They don't have new fluids or new Rankin cycle systems on the top. They literally just have a better way to look for geothermal.”

This week, Beebe joins the show to riff on AI-driven climate solutions, the need for more clean, firm power to meet rising power demand, and a variety of other tech trends that are shaping what he calls “the climate decade.”

Utility rates could make or break the energy transition — so how do we do it right? On June 13th, Latitude Media and GridX are hosting a Frontier Forum to examine the imperative of good rate design, and the consequences of getting it wrong. Register here.

And make sure to listen to our new podcast, Political Climate — an insider’s view on the most pressing policy questions in energy and climate. Tune in every other Friday for the latest takes from hosts Julia Pyper, Emily Domenech, and Brandon Hurlbut. Available on Apple, Spotify, or wherever you get your podcasts.

Transcript

Stephen Lacey: In the late '90s, Andrew Beebe co-founded an e-commerce platform for small businesses. It was called Bigstep. The company raised $60 million, brought in 9,000 customers, and was acquired in 2002. But like most startups, it first took a lot of nos to get there, even at the start of the dot-com bubble.

Andrew Beebe: I went to my venture friends and they told me, "You're crazy. This'll never work," because I remember going, in 1998, up and down Sand Hill Road and telling them about our internet company where you could engage in commerce on this thing called the internet. And they then again said ... I mean, these are some of the most famous story brands of venture capital, said, "Yeah, I don't know if people are ever going to put their credit cards on that internet, Andrew. That's a cute idea, but I don't know." That was the mindset. So when we had a different view and people thought we were a little bit crazy, to me that's a good place to start.

Stephen Lacey: After he sold the company, Andrew started looking around for the next big investment category. He landed on a space that had just been coined clean tech.

Andrew Beebe: There actually were not investors in what we called clean tech back then. There was not. No one was talking about it.

Stephen Lacey: Now, there were a handful of pioneering investors. An organization called the Cleantech Venture Network formed in 2002, and it tracked about a billion dollars globally in venture capital across energy, water, and materials that year. Still, there was not yet a cohesive narrative around the sector. In 2003, Andrew went to an alternative energies conference in Aspen, and he thought, "This is it. This is my chance to meet like-minded people who are actually investing in this stuff."

Andrew Beebe: And I found out on the first day that, in fact, it was alternative energy. It was tar sands and fracking. It was about the alternatives, this crazy new energy revolution on different ways to extract fossil fuel. So I was in the wrong room. In many ways, I was in the right room because I got a real smack across the face in terms of where the state of the art that the burgeoning new technology was. And it was not in areas that I was excited about.

Stephen Lacey: And if his friends in venture thought that e-commerce was cute, wait until they heard what he did get excited about. Solar. The solar market was tiny. It was easy to dismiss. We install about as much solar PV in a single day than we installed in all of 2003. But Andrew hooked up with another believer in solar, tech entrepreneur Bill Gross. Bill has founded a lot of companies, including Picasa, a photo management product that was acquired by Google, and Evolution Robotics, which merged with iRobot. He also came up with a paid search model that became the financial engine of Google. He's founded three solar companies, an electric car company, and a gravity-based storage company. And Energy Innovations, a commercial PV installer, was his first company. Andrew teamed up with him to build it.

Andrew Beebe: I had looked at hydrogen, I had looked at different types of flow batteries, and all sorts of new technology. And I really honed in on solar as the one that was expensive for illogical or unnecessary reasons. And it took about 10 years but we, along with, at that point, thousands of other people, we were able to really transform that industry to what it is today. And in fact, it went much further after I stepped aside. And we went from $10 a watt when I started to a dollar a watt when I was leaving. And really, people have taken it almost in order of magnitude down from there. And it's just extraordinary.

Stephen Lacey: There were a lot of people who doubted solar, of course. Were there any predictions with solar that played out as expected? And then were there any that you thought would happen that didn't play out?

Andrew Beebe: Yeah. I mean, we used to run around and tell investors and anyone who would listen, with our fancy spreadsheets. Bill Gross and I ... Bill was the founder of Idealab. And he was the founder of the solar company that I joined up with him to create, and he was the CEO and I was the president. We would run around with fancy spreadsheets and special models that would tell everyone how we were going to get from this $8 or $10 down to a dollar a watt. And the truth was, like any good founder, we didn't know exactly how it was going to work in exactly what timeframe.

And then when I sold that company to SunTech and I joined Zhengrong Shi at SunTech, who is the founder of SunTech and a wonderful solar cell scientist, he really understood the science much better than I did. And he had the same thing. And I remember we went to a ... I think it was like a Fortune Magazine interview or something about the future of solar. And he was pounding the table, saying, "We're going to get to a dollar a watt in two years or three years." And we left the meeting and I said, "I want to believe that, but how are we going to do that?" And he said, "I really have no idea. I don't know how we're going to do this." And we weren't sure.

And what followed was we and the industry overall got there faster than we expected. And one of the key catalysts that I hadn't really understood was the ability to use non-semiconductor-grade silicon, not the purest type of silicon, to make solar cells. So instead of radical innovation, people like Nanosolar and even Solyndra and my company, Energy Innovations, trying to do gallium arsenide high concentration modules ... Instead of these big breakthrough, different approach technologies or thin films or perovskites or whatever, it was brute force, supply chain scaling and engineering in our learning curve.

Now what's happened is because of that scaling and because of those learning curves, we have done, now at this point, both. We've radically reduced the cost of a solar panel, but we've also made it much more energy efficient. Those two don't have to, but they can go hand in hand, and they have here. So now, the solar panels I have on my roof are radically better than the solar panels I had 10 years ago on my roof. And it's so cool, and yet they're much, much cheaper. It's instructive, that sometimes the tried and true stuff that just doesn't look exciting, because of its cost structure or supply chain or something, can break through and can actually then come to dominate.

Stephen Lacey: This is The Carbon Copy. I'm Stephen Lacey. This week, a conversation with Andrew Beebe of Obvious Ventures. After a decade building clean energy, Andrew shifted to another decade investing in it. Today he's the managing director of Obvious Ventures, running its decarbonization portfolio. I sat down to talk with him about what's catching his attention these days, which includes everything from nuclear to AI-driven science to geothermal and AI-fueled geothermal. That conversation is coming right up.

So you write frequently about the tech economic market forces that are shaping your view on companies or sectors that you're investing in. And back in 2021, I remember you wrote this piece about how we've entered the climate decade. You walked through everything from costs to consumer preferences to the emergence of a more sophisticated class of climate venture investors. Here we are, we're almost halfway through the decade. Obviously, a lot has changed since then. We've got a very different macroeconomic picture. We have rising power demand, big new load pockets across the country. We've got a new era for AI, lots of IRA spending, a surge of EVs, electrification. So much new has happened or has been a continuation of the trends that you saw playing out. What is your view on how the decade will play out? Has it changed since that piece in 2021?

Andrew Beebe: I'm really good at putting forth a bunch of ideas and then not holding myself accountable for the results.

Stephen Lacey: Well, here we are.

Andrew Beebe: So I should pull it up. I really should take a look. But yeah, you're right, at the halfway point would be a good time to do that. I think that the review of those predictions and sort of the state of where we are would be a story of puts and takes, some good things and some bad things.

At the macro, one of the things that has continued, I've been very pleased to see, is just ... Well, two things that have continued. Massive influx of capital that's I think catalytic and helpful, and different flavors of capital too. So yield capital, people who just want to build solar farms and wind farms and people thinking about afforestation and real estate when it comes to resiliency and the ways that it might impact climate in beneficial forms. So infrastructure dollars. These are lower yield things. And then venture dollars and then growth dollars. So I'm very happy companies, firms like Generate Capital, have innovated in that realm and the in-between realm, and then a lot of venture firms and then typical folks like Wellington and Goldman and BlackRock and others just pouring capital in at the upper end. So that's something that we talked about then and has persisted. That's terrific.

I think the other big one is just the extraordinary amount of youthful energy coming into the field. There's a lot of talk about climate despair and mental health with young people, and climate being part of that. I'm sure that's true. I'm also sure that young people are ... A lot of people, but young people, are incredibly energetic and they're not going to give up.

And what I see of people graduating and entering college ... I asked Yet-Ming Chiang, a wonderful professor at MIT and a famous founder of many companies in climate. He still teaches, I think, a chemistry 101 course with freshmen, which I love. And I asked him, "What do they want to study?" And he said, "Well, 50% want to do climate." And I lamented that and said, "Come on, what do the other 50% want to do?" And he wryly smiled and said, "Well, they want to do robotics and they want to do computer science for climate." So his rough view was that it's all the best and brightest minds, especially on the technical side, are thinking about. And that's extraordinary.

So those two things, money and energy from future founders and future engineers and future HR people, whatever their role is. I think there's just a lot of influx. And that was very different than 20 years ago, when I think the ranks were thinner. I think we've also had some surprises. If you had asked me four years ago about, "Hey, do you think there's going to be one of the biggest expenditure bills in the history of the US government only focused on climate passed and signed by a president?" I would've said, "No way. That's not going to happen." And there were some people in the venture world who were betting on that, and they actually invested in companies expecting that, and I think they've done really well because of that.

So we've had some big windfalls, big opportunities. But on the flip side, I don't think the corporate consensus is as tight as it even was four years ago. I think that people are hedging their bets, hemming and hawing. And the latest version of that that I'm very worried about is large tech companies acknowledging, "Hey, we're not going to lose this AI thing." I think they're going to blame it on China and say, "Hey, it's a national security thing we can't lose, and therefore we will hit our climate goals. We're just going to be a little bit delayed. We're going to go back and build a bunch of natural gas plants to power a massive build out of our GigaCenters."

And that may not happen, but that's a future that I'm not looking forward to because if that were to start to happen ... They were the leaders that showed the rest of the corporate world that you could stake these claims and you could go down this path. And I really laud them for it. It's extraordinary, what they've done. For them to unwind that in any way would be politically really dangerous, and I think it would start to give permission to other people, who have been far less focused and committed, to start to backpedal easily. And I'm talking about oil and gas majors, infrastructure people for whom that transition is just very, very costly and difficult. It's existential, but it also includes maritime shipping companies, large industrial companies, commodities, steel, cement, agriculture, whatever. All of these companies are trying to figure out how to make this transition while I suspect many of them, at the same time, are maybe hoping it goes away a little bit, this pressure. Without that pressure, I think some of our objectives are just slipping out of reach.

Stephen Lacey: I want to slice off that AI piece a bit. That brings us to one of the first topics that I wanted to chat about, your investment thesis on AI in climate tech specifically. I mean, clearly the power demand issue is a problem. We just saw in Microsoft's sustainability report, emissions have gone up 30% in the last year, energy demand is up 20%. And they're basically saying it's all AI in their data center expansion. And they're going to double the amount of data center capacity they have in the next year.

So it's a big deal, but I am a believer that the net benefit to the energy system in society will be positive. It'll unlock all sorts of new and interesting applications in the power sector and beyond. And I know that you are really focused on the AI space. In talking to a lot of investors, many don't see AI as a standalone category. It's sort of like it fits into other climate tech classes. How do you at a broad level think about AI in climate tech?

Andrew Beebe: AI in climate tech is just a fascinating discussion because I think for sure, in some ways, AI is driving this explosion of electricity demand that could set people back in their climate goals. At the same time, many aspects of AI, as an enabling technology, are going to help us present solutions to these challenges. So it's pretty circular, pretty complex. But let's see, a couple things. I think the explosion of demand for electricity is a good thing. It can help drive a transition to a cleaner generation, but there's a matching and a speed problem in terms of catching up to that demand. And I think that that is what people are fretting over. It's not just AI. It's also electric vehicles, it's also crypto. It's also onshoring in the case of America. So these are big challenges that are not going to go away.

What we need to focus on is, I would say, unlocking gridlock. Gridlock for me is this concept of not being able to get more clean base load power generated, but then moved and then removed from the grid itself. And all of that, those are three big things. Make it, move it, and then use it. Those are all ripe for innovation and investment. I have no doubt that innovation and investment and AI itself will be extremely helpful in solving those problems. We are very, very good, when we focus enough. We're very good at solving these deeply technical challenges.

I am worried about the timing of it. And that's why I would sequence ... Just to take the generation side, I would sequence it in three phases. What are the things we can do right now? What are the things we can do in the near term? And then what's the long-term future? And to me, the long-term future, I think it's very likely that it involves fusion as a generation source. Fusion, even if or even when we make it work, it still will be very expensive. It's an expensive process to build out this infinite power source.

It's pretty cool that it's infinite and maybe has essentially no fuel, but the sun has no fuel and is infinite or close to infinite as a power source, and we've been using that for a long time. It was very expensive. It took a long time to make it cheap. That's going to happen with fusion too. It's got better characteristics. It's base load. We could put it all over, but it's going to take a long time to make that cost-effective. That's a 20 to 50 year benefit that we should be focused on now, investing research dollars in now. I'm not convinced we should invest venture in it now.

In the near term, midterm, I think nuclear fission is going to have a renaissance and come back in a big way. Hopefully that involves small modular reactors. It may just involve a whole bunch of AP1000, big light-water reactors around the world. Most other people in developed countries and in some emerging economies are doing that today, and we're not. So I hope we can get back on that train, and I hope we can do it more cost effectively than we did in Vogel or the Carolinas. So there's work to be done there. I think that that's an interesting midterm solution.

In the near term, we have recently made an investment in Zanskar, which really brings all of these things together. Zanskar is a very exciting geothermal technology company, but it's really an AI company. They are just using software to deliver what we would call generative science. There's generative media. Large language models have been doing incredible things to make great chatbots and enable a lot of co-piloting across the business world. I think generative science is the next phase where we're still using the similar algorithms, but the inputs are much more about physics and much more about chemistry and biology. And the outputs are about breakthroughs within those areas. And that generative science is going to shorten the distance to some of these massive solutions.

Zanskar is generative science at work. They take physics-based models, physics-based data sets, train models on them, and then output basically a treasure map for where we should look for large deposits of heat, of shallow deposits of heat that are accessible for geothermal electricity generation. Today, geothermal is a great source of energy, but it's hard to find. Unless you see steam shooting out of the ground, we actually have trouble locating big areas of heat that aren't super deep. Super deep heat-

Stephen Lacey: Are you talking about just heat, or are you talking about hydrothermal resources or just hot rock?

Andrew Beebe: Yeah, great question. So I'm talking about super critical areas where you have enough heat that either using liquid that's in the ground or using above-ground liquid, you can do a thermal transfer and make electricity. So this is not about heating and cooling. There are a bunch of great companies, Dandelion and Bedrock and others who are working on that. This is about power generation systems that have power plants topside, that can pump tens or hundreds of megawatts of power onto the grid.

So Zanskar doesn't have special drilling technology. They don't have new fluids or new ring and cycle systems on the top. They literally just have a better way to look for geothermal because in America, there's only a few sites, like geysers in Northern California where we see stuff coming out of the ground. In Iceland and Indonesia, there are a bunch of sites because you can see the steam coming out everywhere. It's very accessible to get to that very, very hot area underground.

Today, when we drill wells looking for geothermal, we'll drill 10 wells and get one hot spot. And that's not cost-effective. Those wells are very expensive. With Zanskar, they have been proven that they can drill 10 wells and get 90% hit rates. And so 9 out of 10 instead of 1 out of 10. That flips the switch on geothermal being an extraordinary power source. This is a here and now nuclear power source that we can turn on anywhere, with no waste and a lot less regulatory approval needed.

So I see a world where ... And these conversations are happening now, where the major tech companies, they'll go and buy more merchant nuclear facilities like Amazon did. I think, there's 9 or 10 of those in America. There's 90 nuclear facilities, but only a few of them are merchant. That'll work. That's a net-zero gain. So that'll take power from other people, and I think that's going to create some challenges. But building de novo facilities to power either clusters or GigaSites for massive data centers I think is going to be much, much harder. And they're going to try with small modular reactors. That's a ten-year process. But doing it with geothermal, I think we could do in three or four years very, very easily. And that's what I'm excited about in the near term.

Stephen Lacey: So back to the AI piece. I'm particularly intrigued by the use of AI for things like materials discovery or exploration, which we've been talking about. Not just geothermal, but stuff like geologic hydrogen, right? There's a lot of interesting applications of AI there, to find these pockets of hydrogen deposits. Grid planning and grid modeling. What other areas of AI application are you most interested in?

Andrew Beebe: So at Obvious Ventures, we invest in planetary health, human health, and economic health. And I lead the planetary piece. But on the human health front, that's where AI has had a lead for a long time. I was reading something funny about AI where a researcher was saying, "Look, in AI research, once it goes out of research and starts getting used in the real world, it's no longer called AI. It's just called software." And so Siri, people don't think of it ... It absolutely is AI. Even a Google search for the last 10 years has been AI-driven, machine learning-driven, but we just think of it as software. And it also becomes very obvious and standard which is, I'm sure, frustrating or humbling for some of those early technologists who developed it.

I think in drug discovery, we were early investors in a company called Recursion Pharmaceutical. And Recursion was using AI for a long time to help speed the process of drug discovery and drug approvals. And we see it again and again in that realm. Genomics is this incredible field that used a lot of compute to make sure that we could map the human genome. We're now trying to do that with proteins in the field of proteomics which, to my understanding, is much more complicated even than the genome itself, and then mapping the human genome. And yet we're doing that, and I think we're going to do it faster because of the use of AI. So in that realm, there's great opportunity.

In our world of climate, we talked for decades about this concept of a digital twin. And GE, I'm sure, made some cool commercials about their jet engines and how they could look at the blades and wear and tear in carbon fiber because of the digital twins. And I think that's real. I think that was a real thing. Those are expensive and complex systems, but they were driven, I'm sure, even then, with some use of machine learning. And now that kind of physics-based model inputting into ... And mechanical models and materials models getting inputted into very similar models to the generative AI that's used in media, I think is going to produce this world of generative science. And it's going to bring us closer and closer to what we consider the edge of the possible today, and actually will push out our definition of what's impossible.

I see an analogy in that exact scenario to wing design for aircraft. 40 years ago, maybe even 20 years ago, if you were building a new aircraft or you were building a new car design, you would have your models, your digital models, and you would make fluid dynamics analytics and predictions. But until you put it in an air tunnel, until you flew it, you just weren't sure. Now, that gap has gotten much tighter. And our fluid dynamic software is extraordinary, and our ability to predict the outcome is in the 99%. So at Lightship, which is just an RV, it's not a flying vehicle, but we ... And this happened at Lilium too, which is an electric flight company. We modeled designs in software, and then we ultimately built them, put them in wind tunnels, and drove them, et cetera. And our predictions were spot on. So that software has really leapt past where we were in a very difficult thing to model.

The same thing is going to happen with things like fusion containment vessels. And then we will ... The iterative loop of how quickly we can build and test things is going to get much more rapid. And the same thing with chemistry models for materials, as you said. Materials like batteries are the obvious choice, but even plastics and polymers that are going to be better at unlocking themself after use so that they can be broken down and either recycled or composted much more readily without some of the challenges we're facing today.

Stephen Lacey: Well, since you mentioned Lilium, I do have to ask you about electric aviation. So the last time, I think, we actually recorded a conversation together, it was in 2018. And we talked specifically about electric vertical takeoff and landing aircraft, and how it would change regional air travel pretty quickly. And I'm wondering, do you still believe that? What developments have we seen in that space, and has it met expectations?

Andrew Beebe: Quickly was probably a little bit of a stretch on my part, but it's still happening. That company went public. And we're no longer an investor in it because when companies go public, we tend to step away. But I'm still a huge fan of what they're doing. And I think they are, let's say, a year or two away from human and commercial flight. And Joby Aviation, another competitor of theirs in the US, is also on a similar trajectory. And it's very, very exciting. I do think it is going to transform things, and I do think that they definitely overestimated what they could do in the two to five-year timeframe. And I believe that once they and others prove that this is truly viable and working, I think you're going to see an explosion of other companies doing it, and of market adoption.

We see this in the drone industry. Drones were sort of magical and weird and playthings. And now, not only are they critical in warfare, but they're also doing things ... I mean, I'm sure you've seen a drone show where hundreds or thousands of drones are in coordination with one another, displaying billboards in the sky. I was in Dubai recently, and just strolling along the gulf in the evening, and looked up and there happened to be a drone show. And I was mesmerized. It was very impressive. But at the end of it, the drones configured themselves into a QR code, and you could just point your phone at the QR code in the sky and get more information. It was basically an advertisement, I think. But that is magical and miraculous that that could be done, and it's now a very cheap and commonplace thing.

So I think we're going to see that kind of adoption curve, where it's just going to take a really long time to make sure that it is safe and capable. And then after that point, people will realize, "Wow, this is cleaner, cheaper, safer, and better. Let's go full tilt," and then you'll see massive scale.

Stephen Lacey: I want to go back to the solar example for a moment, and talk about lessons learned or how you're applying that to other sectors that you're investing in right now. So in the early, mid-2000s, there were lots of investments in different thin films and solar paints and solar glass and all sorts of variations of steel and glass for concentrating solar power, and crystalline silicon PV won out. A lot of people lost a lot of money. And solar today is the cheapest form of electricity almost everywhere on earth. And I wonder if you look at any other areas, where there's a lot of investment, a lot of activity, a lot of different experimentation, and if you see a particular technology make the same impact in a sector like solar did in the power sector.

Andrew Beebe: Yeah. I mean, we are shaped by our experiences. So of course, this weighs on me. And I often try to disassociate myself with some of those past learnings, because I worry that I'm too focused on not repeating some of those experiences in the past, and instead need to remain open to the concept that things really change. And the classic example there is battery technology. Battery technology is going through the exact same kind of scaling and ramp, and even the political challenges are the same. Let's tariff everything from China, let's try to make it here.

And what we decided as a firm was the outcomes were going to be pretty similar too. Whether China dominates or Korea dominates, I'm not sure, I don't think cell manufacturing is going to happen here without contortions on the political front, but I think batteries are going to be as big an industry, if not bigger, than solar in a lot of ways because of their impact on automotive. And yet, we have not invested in a single battery chemistry company. And I'm very happy about that. I think a lot of people have lost their shirts, and it's been a really challenging place to invest in startups.

So the extraction extrapolation I think that you're asking about is ... I do think a broad lesson for us is commodity markets are difficult places to build lasting venture returns. So there may be some arbitrage where in the near term, sustainable aviation fuel is in such short supply that if you've got a clever way to make it that's verifiable and green, you will have asymmetric benefit. And even in a commodity space, you'll be able to command a premium. I'm not sure that's a 10-year plus, long-term, sustainable business. A lot of my venture friends have made bets in that space and we have not. Same thing in agriculture. I think there's a great opportunity to decarbonize the fertilizer industry. And we're trying to find places where we could invest that are long-term and resilient as business models, not just a slightly different way to disintermediate the Haber-Bosch process.

So I think there are lessons to be taken from it. They may be lessons from investing in general. If you're going into a market that is a commodity market, if you're going into a cutthroat competitive market like automotive component supply, or if you're going into a market that really doesn't ultimately have a extraordinary technology moat, it's just getting there first, those are all tells in venture capital land that ultimately ... I mean, really what it means is ultimately lead to very, very low margins. And we have traditionally not been great at using venture dollars to radically scale super low-margin businesses.

Stephen Lacey: What are your wild cards for the year, or for the rest of the decade? Are there anything that you're now just thinking about that you think could be transformative that maybe wasn't on your radar until recently?

Andrew Beebe: Yeah, that's a great question. Again, one thing in the last five that was a surprise to me was the American political will. I often believe about America, we sort of show up late, but boy, when we show up we can have an impact. And that's true in geopolitical conflicts, but it's also true in domestic policy. And so I was really pleasantly surprised with the impact that the climate bill is going to have, but even emotionally had for everybody.

I think that that's a wild card. What happens next there? That could swing in either direction, either just undoing all of that, which would be a colossal disappointment, but also other versions, like doubling down. I think as Republicans understand that, at an existential level, this is just a losing issue to be on the wrong side of, you're just more wrong every single day. This is not a socio-political issue, and it's not something like taxes where you can pick a side and maybe hold your ground. Climate, you just lose. You just lose slowly or you lose quickly.

I think when they come around to that ... And some of them and governors are already starting to do this, certainly at the state level, this is happening all over the place. I think we may see more of a consensus view, as you see in Europe, as you see in Asia, everyone just realizing this is not about politics. This is about a challenge facing humanity. The solutions may be politicized, but the challenge itself really isn't. So I think that that is a wild card that has yet to be understood.

Stephen Lacey: And what about tech wild cards? Do you want to play your hand there?

Andrew Beebe: I mean, it's not a wild card, but I do think that AI ... The ultimate complex system is the grid. I think that AI applied to the grid itself may actually finally deliver us this smart grid that we've all been talking about for decades. That would be magical and very exciting. That's an hour-long discussion in and of itself. But I think that that's a big one that I would be very, very excited about.

And then I think we're just getting started in terms of what batteries are going to do to things like aviation, like trucking, and like automotive. I think it's game over for hydrogen-based vehicles. It's game over for internal combustion engines. And there too, I think we had a very, very slow process to get to a 10% number. But typically, with technology adoption, when you're past 10%, it starts to flip. And I'm watching residual values of internal combustion fleets because I think they're going to plummet. I think that's going to have an impact on lease companies. I think it's going to have an impact on insurance companies. There's just a lot of the economy that is based on reselling old things, and this is the stranded asset problem that the utility industry faced. I think we're going to see that all over the place. Even with Florida real estate, we have a stranded asset problem. So I'll watch those and some of those could be tipping point items that will get very exciting.

Stephen Lacey: Andrew Beebe, managing director at Obvious Ventures. We covered a lot of ground here. Thank you so much.

Andrew Beebe: Such an honor to be here. I love doing this with you every few years. It's a nice retrospective and future-looking discussion.

Stephen Lacey: And that's going to do it for the show. Head on over to latitudemedia.com and make sure to subscribe to our newsletter. If you were subscribed, you might've seen the story we put together on the Obvious Ventures Zanskar investment, and what the combination of AI and geothermal means for the industry. You'll get all our editorial coverage in your inbox when you sign up, and we'll also have a roundup of our podcasts at the end of the week. You can find transcripts as well.

And if you could just do us a favor and give us a rating and review on Apple and Spotify. It is so helpful. And there's a reason why we ask that every single week, because it actually is helpful. And this show is produced by me, Stephen Lacey. Sean Marquand is our technical director, Anne Bailey is our senior editor. Sean composed our theme song. And Latitude Media is supported by Prelude Ventures. If you want to learn more about their investment strategy in climate tech portfolio, go to preludeventures.com. Thanks for being here. This is The Carbon Copy. I'm Stephen Lacey. We'll catch you next time.