Ep16. Nuclear Update, AI Fast & Furious, State of VC | BG2 w/ Bill Gurley & Brad Gerstner

**Bill Gurley** (0:00)
There's a picture you can look up, that's kind of disgusting, so people may not want to, but there's this thing called a garbage tube, which is what they use to make for grow. It's how they force feed the geese to get them just super fat. And that's the image I have in my mind. Like, are we overfeeding these startups?

**Brad Gerstner** (0:32)
Hey, Bill, great to see you.

**Bill Gurley** (0:34)
Good to see you, Brad.

**Brad Gerstner** (0:35)
Man, that was an amazing pod at Diablo Canyon. You know, the inbound regarding just nuclear has been off the charts from literally senior policymakers, senators and house members on both sides of the aisle. It really feels like the dam is broke. You know, we have joked, Bill, that Microsoft, you know, when we were down there, we discovered that there were four unbuilt nuclear reactors that are all already plotted on the site. And we have joked that Nvidia and Microsoft and Oracle could come sponsor these reactors and that they could have a new type of public-private partnership with the government and build data centers right next to them. And it turns out it wasn't so far out there. I mean, Oracle has announced, you know, that they may do some things with small nuclear reactors. Amazon is, you know, buying this nuclear-powered Talon data center facility. And now Microsoft this week announces with CEG that they're going to bring Three Mile Island, you know, out of retirement. It's incredible to see the beginnings of what may be a US nuclear renaissance.

**Bill Gurley** (1:42)
Certainly, the momentum has if maybe it was headed up and then it's kind of reached an apex and kind of fallen over. The FT article yesterday or today highlighting that 14 different banks have shown up at a climate conference with a confirmation of a willingness to invest is just huge. And I think there are two things that are big takeaways for me. One, we were talking about one of the limits on SMR and on any new innovation in the space was that utility companies are traditionally very conservative. And I like to think about it in the framework of crossing the chasm. You basically are selling only to laggards. And that's very difficult for me, especially for a capital intensive startup to be selling only to laggards. And what may have transpired literally in the past month is the hyperscalers. And this may have started before them because Amazon did the deal with CEG a little while back. But if the hyperscalers become part of the customer set for the nuclear startups, that may be like 10x better than selling just to utilities alone. Like you may have brought innovators to the table on the purchasing side, that may be more open minded, that may be more understanding, may be more willing to share risk, which could be very positive for the SMR market. So that'd be my one big takeaway. And the second one is just that, you know, a lot of times I think people look at big, big problems and think they're insurmountable. And I remember actually in the past two years being at an offsite conference at a think tank where we were talking about climate change and about 80% of the way in, and someone raised their hand and said, why aren't we talking about nuclear? And all the scientists in the room said, oh, no, we're not going to put that back on the table. That's too far gone. That's past.
And it turned out that wasn't true. It turned out there was an opportunity to get a renaissance in thinking about this. And it started, you know, I think with people like Steven Pinker, who are wildly regarded scientists saying, no, this is our best path out. But then, you know, we talked about Patrick Collison and others kind of jumped on the bandwagon. And then there were plenty of, you know, pro nuclear advocates that were sticking their neck out. And then Elon gets in the game. And then this data center thing may have been just the impetus you needed to get people over the top.
And we were lucky enough to kind of time our thing as this transition was happening. But it is possible to create kind of wholesale change in how people think about something. But it takes a lot of work by a lot of people and everyone that kind of stuck their neck out early. Josh Wolf was another one that was sticking his neck out on this topic. So I congratulate all of them. And it feels like the momentum is now behind us. And I literally feel bad for the citizens of Germany. One thing that is very apparent is that the easiest thing to do is bring, well, start with don't decommission any of these things. But second, if any have been decommissioned recently, try and bring them back. And I hope there are some sane minds in Germany that are watching all of this, because I think the world would benefit from them reversing that decision and running back at this.