The Wisdom Wall
8 quotable lessons, heuristics and mental models. Every one is playable at the moment it was said. No fortune cookies allowed.
“What we found looking at over 300 projects, 350 projects in the past couple of years, is the fact that the companies that actually deploy their own technology and follow that path Are the ones that get to success. There are companies that have spent two or three years in the licensing route, where at the end, the…”
“my, our contention is that capital is an issue, but the biggest issue is the skill set that is required to be able to help the companies see a risk and really assess the risk of that big construction operation of first of a kind.”
“The way we propose to do this is, you know, that company has to follow a path towards that de-risking, and that path in our, ah, experience is you go from a pilot to a five to 20 x demonstration project, and then you go to another 10, 10, 20 times, ah, first of a kind project.”
“What we know is at the end of the day, the investors that come in at the Series C, Series D, you know, most of the time funding or partially funding, um, first of a kind projects, they really want to see six months or more, or performance, uh, because things degrade if you continuously operate something in a way that…”
“we find that many times off-takes are priced in a way before engineering, you know, failed one, failed two, engineering have been done, and it's based on optimistic CapEx assumptions. Now, when the companies go through the engineering process and they actually get to a feed, they find out that CapEx is twice as much.…”
“The challenge is the fact that these companies reach a point where the technology has been proven, but it has not been the risk in the eyes of large scale infrastructure capital, right? Whether that is Infra funds or project finance banks, right? So you need to find a way to get these technologies over that, over the,…”
“many times though, people think they're going to make money off the demo, right? When, in that, in our experience, we found that's not the case. The case is that most, in most cases, the demo is a very large R&D exercise. So money losing, unprofitable R&D exercise on every aspect, including the commercial aspect of how…”
“what we've seen is most of these infrastructure investors really play for the platform, right? I'm putting X hundred million dollars in the first project. What I really want to do is put a billion dollars into your next two or three projects, and a lot of them are getting options for those projects, but because what…”