Stay on Top of Enterprise Technology Trends
Get updates impacting your industry from our GigaOm Research Community
During the hour long interview that Tesla CEO Elon Musk gave this week at the D11 conference, my Twitter feed was filled with intense adoration and accolades about how inspiring Musk is and how his companies are disrupting sectors far outside of the internet. He deserves all that attention, and more. But a big part of the reason why he’s now experiencing such rock-star status is that he’s a total anomaly when it comes to focusing on using technology to fight climate change and help the planet on a large scale — few entrepreneurs and investors in Silicon Valley these days are aggressively, and vocally, focused on this topic and these innovations.
Yes, the argument and the lamenting about how the Valley can’t solve “big problems” is one that has been covered ad nauseam in recent months. Our Om Malik had a great blog post about a viral cartoon video of what it would have been like if Nikola Tesla pitched VCs (VCs are short-minded, and hilarity ensues
). Jason Pontin had a fascinating cover story in MIT Tech Review about Why We Can’t Solve Big Problems.
But I’m specifically talking about the topic of using tech to fight the problem of the changing climate. Musk stands out above almost all other entrepreneurs in his willingness to continuously put this issue at the forefront of the discussion, both through his businesses but also through his words. Even at settings like D11, which are filled with digital-focused executives that got rich and famous off of the internet — just like Musk did.
The climate is warming while cleantech is cooling off
There are a couple reasons why climate change as a topic and a focus for innovation has gone out of fashion in the Valley in recent years. The major one is that many of the entrepreneurs and investors that actually tried to start new businesses focused on fighting climate change got completely — and utterly — burned in the cleantech boom between 2006 to 2009 and the recession-led bust over the following years (my slides from a keynote last year).
Both passionate well-known founders and venture capitalists with impressive reputations shifted their careers toward using technology to create climate change solutions, and then found out that it was far more difficult, and took far more money, than they had thought it would. Their shared experiences before they jumped into cleantech were building technologies and business around the internet, software and computing, where the drive to continue Moore’s Law
has been delivering rapid progress along a transparent path for decades (making investing less risky and progress more continuous).
Some of the heavyweights of Silicon Valley are now paying the price for this big picture planetary thinking: venture firm Kleiner Perkins, Shai Agassi (the founder of now bankrupt Better Place) and Alan Salzman of venture firm VantagePoint Venture Partners, to name just a few. Do-gooder, big picture thinking and risk taking is applauded until it’s not successful.
Then there’s a cooling-off effect on others who are both passionate about these issues and hoping to raise money from the pockets of wealth in Silicon Valley. A young entrepreneur asked me a couple weeks ago if I could name any cleantech companies that had gotten series A funding from Silicon Valley in 2013 — I could name very few.
Musk is also an anomaly because he is one of the few entrepreneurs that has been wildly successful at cleantech. He’s one of the only ones I can think of who’ve had multiple cleantech bets that have exited and are still going strong (i.e., not seen their stocks tank), via SolarCity and Tesla. And I’m not even going to go into SpaceX, which seems to be going well, too.
Musk’s companies are part of his overall desire to use technology to disrupt the fossil-fuel burning energy sector and the fossil-fuel burning auto industry. They’re connected by his worry that the practice of burning fossil fuels is unsustainable for the planet. He thought about the problem first, and then designed the solutions he saw that would help solve these problems.
How many entrepreneurs can say they’ve designed companies in such a way around this global problem? Yes, there are some investors and entrepreneurs still focused on this, like Vinod Khosla, Steve Westly (he was also in Tesla), and others; hopefully, they will see similar (and more) successes.
Musk also recently called attention to the problem of the Valley ignoring the issue of fossil fuels and climate change on a political scale. He recently left the political immigration group supported by Facebook’s Mark Zuckerberg, Fwd.us, because the group funded ads for senators vocalizing support for the the Keystone oil pipeline, and oil drilling in Alaska. Khosla also brought attention to the group’s support for the fossil fuel industry and tweeted: “Will Fwd.us prostitute climate destruction & other values to get a few engineers hired & get immigration reform?”
But the fact that a Valley-led political group was so tone deaf on climate change and fossil fuels to begin with just points to how these big planet issues have been pushed out of the forefront of the Valley.
Can folks like Musk and Khosla bring them back with a combination of business success, and inspiring public speaking? I truly hope so.