Clean Tech Trends with Anthony DeOrsey, Research Manager @ CleanTech Group

Oh, today on the show we have Anthony Diors. Anthony is a research manager at Clean Tech Group and we met because I read their annual report at the end of last year, probably a thousand times. I re there were a bunch of people that released endofear reports, aggregations of research, things like this, and

theirs was by far my personal favorite. So, I'd recommend reading it yourself, letting me know what you think. But I reached out to uh one of the researchers and she agreed to podcast and introduced me to the rest of her team. So, this is uh the first episode in a series of episodes where we are deconstructing

their annual report and I'm so excited. This was um Anthony is the research manager. this was a more overall um overarching view on the topic, but just so educational. I mean, I'm just so glad that I was able to ask some of the questions that I did because they're things I wonder myself and Anthony is uh

you know, his life is to uh research these questions. So, it was very informative, very awesome uh the way that he chose to answer them. I'm very excited for you to listen. Shout out as always to our sponsors, Clean Techch Growth Lab. If you're looking to grow in clean tech, they are the people to work

with. And the producers of this podcast, Craze and Friends. I love working with them and you would too. But without them, uh, this would not be possible. So now I give you Anthony. Oh, welcome to another episode of The Grove. Thank you to the sponsors.

Shouted out just before we pressed record, but without them, it would not be possible to interview awesome people doing awesome things like Anthony. Welcome. Great to be here, Blake. Appreciate the invite. Absolutely. I could not help myself. I was hold I gave you a lot of excitement uh at the beginning of this call, but I

could not hold my excitement back when I read your report. uh released at the end of last year 2026 annual report about what's happening in clean techch and uh this is a very special uh be this is the beginning of a very special series of episodes that we have breaking down that report so I think it's only fitting that

this is the first one um you know we got a lot to cover I think your perspective on what's been happening clean techch how to build it stuff like that is super awesome for anyone that doesn't know yet if you give a brief introduction of yourself and what you're building.

Yeah. Great. So, my name is Anthony Diorsy. I'm the research manager at Clean Tech Group. If anybody's not familiar with Clean Tech Group, we call ourselves the human intelligence authority on clean techch innovation. And if I were to pick that apart in a few ways, we do really pride ourselves on being human intelligence. and my

team, our market intelligence team, we spend our time going out and doing this just with founders, corporates, investors, people who are hands-on in the field with the technology to understand from the bottom up what is broken in the system and how new technology can fix it. And from there, we form perspectives and we render those

in a few different ways. We have a market intelligence platform and service that we have all kinds of members from corporates, investors, governments, economic development agencies who engage. And we do a series of events every year too. The Quintech forums just had our biggest one of the year in California, the Queen Techch Forum North

America. We do one in Europe every year in a different city and in uh Singapore as well. So what we really tried to do is consistently develop intelligence off of human intelligence and bring that to a member base that again is in a pool of clients but also is in the form of event

attendees and try to keep them updated on the newest things that we think are going to impact the markets. So, um I mean just so many questions about so many different directions that we could go as far as uh because very broad you know I think what you guys report on what clean tech means. Um but

before we get there did you as a child run around saying I cannot wait to be uh this clean techch uh you know research manager at clean techch group or or did something happen at some point? No. Uh well no to the first question. It was certainly not my ambition. I think uh you know my my ambitions evolved as a

child from wanting to play safety for the New England Patriots. That didn't quite work out. That became apparent probably by uh probably pretty early that that wasn't going to happen. And then uh oddly enough, and I'll share it because it's just that kind of venue here.

My idol growing up was Stuart Scott, the ESPN Sports Cer. Oh yeah. I used to get up every day at 600 to watch Sports Center just to hear Stuart spiel because he could cover so many things so fast, but was so intelligent with his delivery. So that is not to say I made a direct connection

between being a sports cer for ESPN and doing what I do today, but that was probably the first indication that I was going to really like going deep in research and then talking to people enthusiastic about those things. Uh to answer your question in a more serious way, my arc a little bit was uh post

college I had thought that I was going to go to law school. Um I thought better of it. Uh no no shade to lawyers, but I did a little bit of time in a startup and felt like this is just the best way to spend a workday is to work in fast-paced environments working on

things that are really important. Um a really important detail is that startup was in China. I had moved to China after college to do a year stint as an English teacher. Left that halfway through to join this startup and uh that was in 2011 and I felt like there's no more interesting place in the world to be

than China in the next few years and you really saw this very nuanced thing happening in China where the economic growth was so significant and people's lives were getting measurably better every year. But there was this huge environmental impact right of the product of the progress and of that much growth in the

economy especially in the real economy of manufacturing. That really put into perspective for me that it is not a black and white. You should not be dropping economic growth in these improvements that come to people's lives for something like environmental impact reduction. But you also shouldn't be ignoring that because that's going to create real life

implications. And that to me felt like the biggest opportunity and most exciting thing you could really do in the world. And how do you just do growth better? So that was probably my first foray into sustainability. And that was the startup I worked in was one that made natural cleaning products from sustainable sources. Uh was kind of a

wild ride, but it was a lot of fun. Went from there to working in a market entry consulting firm in China. And then, you know, a few jobs later ended up here at Clean Techch Group. But always was that throughine of how do you use technology to make people's lives better, but also

to create a bit of shared growth and prosperity. So, I'll uh cut it there, but it's been a little bit of a winding journey more than an arc, but uh these ideas have always excited me. So, really count myself lucky to be able to be immersed in them every day. So um so

first thing is if uh uh if that's an idol does that make clean techch group the sport center of clean techch? Absolutely is the sport center of clean tech and I think you uh you reached out after the publishing of our global clean techch 100 which everybody refers to as the Super Bowl of Que

happens the first month of the year. uh everybody I'm defining probably is just myself but um yeah we really we see ourselves as being at the center of many nodes in this space right we have members to our market intelligence service who are the corporates the investors the governments innovators are an indispensable part of our network we

work with them in a few ways obviously as a a source of information when we're doing our research but also this is we're a mechanism by which their perspectives get represented in front of their potential corporate adopters and investors and then we do things like the global clean tech 100 and our forums to

really give these innovators a stage to be telling that story in a really impactful way. So, uh yeah, we're the sports center. Uh we're the sports center, NFL, and uh you know, Nike, I guess you could say, of Queen Tech all at the same time.

No, I love it. Um I I'm I'm I'm curious um also with the introduction to uh the space being in China and with China being what they are uh as far as where they stand with clean techch and what they represent and all of the you know in whatever industry you want to pick. I

feel like in clean techch there's there's always something to say about what China is doing or has done. Was there something uh I'm talking about the the the cultural approach to clean tech and what it is? Did you see that there was a a difference to how uh people received or thought about or built clean

tech in China versus here uh you know when when you were living there and then once you moved here? Yeah, I think the answer to that question is it, you know, there's there's a book that everybody's reading of late called Breakneck by Dan Wong and it captures really well the differences in culture around economic development

in China in the US and he has this way of characterizing it calling China the engineering society and the US the lawyerly society. Um that is a good highle characterization but I think something that I really observed being there is you get these you get policy signals and those usually have some type

of translation into economic outcomes. Here's an industry the government wants to see develop. Here are markets that are going to be opened to people who are developing in these industries. And you get a very heavy crowding in effect.

What that does in my opinion is that really creates this kind of petri dish of competition and yes you may have some people who are ignoring other industries to pursue this uh this industry is getting a signal but whereas I think a lot of people kind of understand it as China really subsidizing or government

supporting uh some of the clean tech that's a part of it but there's just so much competition and there's a really high tolerance for failure in China in the sense that I think it is accepted across the economy and likely in the government to an extent. A bunch of companies are going to get born. A bunch

are going to compete and most are just going to die. There's not going to be a guaranteed outcome for these. And I don't remember the exact stat. I don't want to give you a wrong one, but back when it was signaled that electric vehicles were going to be a priority, I'm going back 15 years ago. Sure. um

you know it it snowballed to a point where it went from being you know a few dozen electric vehicle companies up to in the hundreds and now I don't know exactly how many there are in China but most have died off and I was there last spring talking to somebody in an EV OEM

who uh is one of the big names in China and he essentially the sense I got from his from the conversation was he's taking nothing for granted and that company is not even certain and that they're going to be standing in a few years simply because of the intensity of their own competition within China,

right? Um, you know, his perspective was there's three or four very strong EV companies in China and we're not all going to win. So, in that regard, I think there's a lot more tolerance for the idea that there are going to be a wave of failures before there's a success case. But then what you're

seeing in the AV space in China, what you saw in solar too is although that pool may thin drastically, a few global winners get born out of it. So So are are you are you saying that uh a lot of at least as far as clean tech goes, the innovation that happens there

and and the the markets and companies that develop are strongly uh the the the first the first domino in that chain is a policy signal. you're saying? Yeah. I mean, if I'm going to put kind of a crude characterization on things, it's, you know, there was always kind of this joke when I lived in China that in

the US everything is legal until somebody tells you it's illegal. And in China, you can assume it's illegal till somebody tells you it's legal. Okay? And I think that that's uh you know, the policy signals really help with that.

And you can look at this across different industries. This was the case in e-commerce in China 15 years ago is where there's more liberalization of things like mobile payments etc. Uh more people crowded into the space. So I would kind of give your answer your question a soft yes. The policy signals matter. It is not everything though. Uh

and I do think it's it's an error in analysis we risk making on this side of the Pacific that it's just all held up by subsidies. and if you remove those subsidies or incentives that it's all going to collapse. Um that might be the case in the early stages of an industry development in China but I would really

drive home that there's such intense competition often that those who are left standing are just well beyond really needing much support. Is is there something that uh again we're speaking broadly but is there something that um the US could learn uh as from China as far as trying to cultivate uh markets or

industries or at least just technologies that are better suited for longer term sustainability. I think understanding certain government uh support at the beginning of an industry as being an investment and not necessarily expecting every single company to thrive, expecting to support industries up to a level and then see those splinter off into networks of

suppliers and seeing knowledge disseminate through the economy. I think that would be a better uh a better approach because you see long-term effects of that. You can draw maybe a bit of a squiggly line, but you can draw a line from things like national labs, university research that might get government grants out to launch of

technologies and then perhaps in some cases tax incentives, subsidies to get it moving. And then beyond that, you you let competition take hold. I do think we have a risk in this country of assessing these things a year, two years, sometimes barely a year in and saying, "Well, there's there's no outcomes, it's

a failure, and viewing things as purely through a cost lens of this cost x amount of taxpayer dollars." If you look at some of the industries that we've fallen behind in, uh, electric vehicles is definitely one, batteries is one, solar is another, we could go down the list. This wasn't all because of just

outsourcing or trade. That's a component of it. But I think a big part of it is there was controversy on these for a long time of government backing subsidies was seen as very controversial and there was a need for or a desire rather for immediate outcomes. I think understanding the trajectory of technology and that these dividends

probably don't become apparent for a decade plus beyond um that would be a better mindset to adopt. That said, some of the things we have in our favor are um a great entrepreneurial environment once you get out of a lab setting, right? Um, you know, I tend to very much so fall on the side that yes, government

grants are a big part of developing technology, but and this is author's own opinion, the hard 90% is taking that out and scaling it. And the 99, you could say 100% of the risk is on the entrepreneur who's going to put themselves at personal financial risk to go out and grow this technology. Um, and

it's there's not many places in the world that you can do that as well as you can do it in the US. there's a robust capital ecosystem. There is a good comprehensive uh set of laws to protect IP. Um and you've got a good talent pool. So there's advantages here too. I think it's more about taking

those advantages from strength to strength and allowing that beginning stage of technological development to cross the gap into commercialization a little bit better. And again, that's a broad generalization, right? Much of it my own opinion. Uh but there are a few things that can be learned there. Cool. Um, okay. So, I'm I

actually because there's a couple more things that I I'm just going to write them down and save them for later because the first uh you know that I appreciate you indulging my curiosity because that was uh a lot of that was just uh based on what you said. The the one thing I wanted to make sure that we

got to was something that you spoke about in your report um that that I think tie it does tie to our discussion about macro level, how to create an industry, how industries evolve, the different components society that that give rise to entrepreneurship, these types of things. Can you help us?

Can you help position us in clean tech history? So what is clean techch history and how do we understand our place in it now in order to then talk about its significance? Yeah. And I think that's a a great perspective to take Blake when you're reading a lot of the media reports around this this theme. We consider it a

theme at Clean Tech Group, not an industry because it's comprised of many different tech areas. Um, you know, we paint very broadly from agriculture, energy, materials and chemicals, transport, waste, natural resources. If you're looking at the theme in its totality, it's it's very common to take venture capital investments as a proxy for confidence in the technology. You'll

hear a lot of reports of a big drop off since 2021 and 2022. But a few things were happening then. There was essentially zero interest rates. It was really low. Uh, it was a low interest rate environment. risk was very much so encouraged. There were these net zero signals around the world and frankly I

think you had a lot of people pivot into the space who were chasing trends and you probably had some companies get funded or overfunded in that period that just were were funded beyond what they could got valuations beyond what they could support in eventual revenue growth. So then you saw down rounds, you

saw a bit of value destruction. That's the narrative of recent years that ends up getting overindexed on in my opinion because those two years 2021 and 222 were really an aberration because of what was happening in the global macro economy with co if you zoom out even just 10 years use those same venture capital investments

as a proxy an entire year of investments 2025 2026 would only equal what you're seeing in a quarter in 2025. So that is fundamentally a 4x in 10 years. Again, take 2021 2022 out of the equation. That is a strong upward trend.

It was ticking up incrementally from 2015 up until 2019. We're still up from 2019. So that's how I would encourage people to think about it is if you're just using that indicator which is it's a good one and it's probably the most uh easily accessible one because everybody understands it that is really uh still

growing. So that's one point I would I would bring to everybody terms of where we're at in clean tech history. I'd also really encourage people to look at the deployment end of the spectrum too. The technologies they're beyond innovation.

and they're much more commoditized out in mass deployment and you're seeing more renewable energy and batteries especially get deployed than ever nowadays. So I won't risk misquoting the IEA or you know some of the the true authorities on deployment but those numbers are higher than they've ever been. I'd also point at the performance

of things like the clean energy ETF in public markets which has outperformed the NASDAQ and even the S&P in recent times. So you know at that later stage when things have been proven they've been they've had the benefit of learning effects from years of manufacturing they've got robust supply chains they're easily understood technologies to the

adopters things are behaving differently and there's less volatility than you might imagine. Again, there's been big disruptions in the past year from things like the effective repeal of the inflation reduction act, uncertainty on tax credits, and that is going to have a blunting effect on deployment, at least on that trajectory we were on in 2024.

Um, yeah, and then blunted a little bit last year. Well, there there there are there are some opinions that say um that the stripping of all that regulation and the the subsidies and things are to and in in from some perspective a good thing because it's helping companies uh build on top of stronger

capitalistic fundamentals I guess where they have to worry about being a strong fundamental company outside of the fact that they're clean tech or green tech or sustainable or something like that. Is that anything that you guys uh see or believe or is true?

I think it's true. Uh I'm going to be a little bit blunt here. I think that the people really trumpeting that as a new revelation or maybe a little bit late to the party, there were things that were hitting an economic wall prior to the removal of those tax credits. And I think those were some of the things that

were perhaps being overinvested on and overs supplied in the innovation ecosystem on the altruistic argument. So I have a few things here and this is uh not at all an indictment of the folks developing these technologies. I think these are worthy pursuits but things like carbon removals, carbon management, right? Um absolutely a

worthy pursuit. You had a lot of technologies that were not market ready. you had a uh a largely voluntary carbon market and there was a lot of faith that got shaken back in I think 2023 2024 around that time there were some scandals there that really had a negative demand effect on these

technologies and if you're looking at who's purchasing the offsets it's primarily tech companies who are offsetting the rise in their emissions from data centers uh at the end of the day it's a very small buyer pool for a large pool of suppliers that was well in motion prior to 2025. I look at another area and that's hydrogen

got a lot of good signals from the outset of the inflation reduction act. There's a lot of enthusiasm out there about the new markets for hydrogen. New being things like bringing hydrogen into steel for direct reduction of iron, uh bringing hydrogen into distance transport fuel cells for trucks, backup power, seasonal shifting, whereas it had

previously been used primarily for ammonia production and then ammonia is primarily going uh or the bigger markets are going to be in fertilizer. What had happened there is that you basically saw people run into challenges with the economics producing green hydrogen even with the tax credits. It was still finding challenges in working

its way into these new growth markets, these markets where it hadn't been adopted before. That was already hitting challenges in 2024. You also had a series of project cancellations in that space. I'm thinking primarily in the steel application. So the again there was this uh you had these economic realities get hit that were sending signals back

through the back through the value chain that this might not be the best area to innovate in. That was happening prior to the change in the tax credits and the tax credits really just got phased out a little bit faster for hydrogen. It was not a fundamental removal. So, uh, I mean that's one part of the answer

to your question is that I think there were some things that already were on the downturn prior to removal of tax credits. The argument of some things now needing to perform under market fundamentals. Yeah, I would say that's the case in spaces like industrial decarbonization.

Uh things like cement, steel, uh electrification of heat, that's all got to be delivered at uh a lower cost than fossil heat right now to to to compete. Um that said, many of these technologies were very early. Um and in that regard, I do think what we risk doing is pushing out the date by which they can become

cost competitive. Okay. Um, so removal of grants or or shuttering of some of the departments issuing grants, removal of tax credits, I don't think it kills what would have been zombie industries, so to speak. What I think it does is it just it frankly takes some areas that were wide open for global competition and it just makes it

a little bit harder to compete in the US in those. Um, nonetheless, some folks are still doing it and I I think that's very much so to their credit. Um, so I don't think there's uh I don't think the statement that now companies are competing on stronger market fundamentals is untrue, but I do

think it's a limited perspective. Uh, I do think there were some things getting pushed to market fundamentals already. Right. So, so, so in some the the it was that was in motion already and the new administration cutting all these things uh accelerated it or maybe just brought it into uh public focus. Would that be

I think you've got two classes of things. things that were facing headwinds to begin with and then uh where the tax credits probably wouldn't have made much of a difference and then some things that were still years out in terms of economic competitiveness and now you've just kind of pushed them further out.

Understood. Okay, got it. Um something uh something small curious the uh the proxy of VC investment um I believe this if I understand correctly so one of the proxies that you use to define clean tech history is VC investment and the other one is uh deployment cool um what what is uh are there any

are there any misconceptions about using those things as proxies or limiters of using those things as proxies and what else can be used as a proxy if anything to define clean tech and to understand its history. Yeah, I think when you're defining progress, you've got a few things. I think you're looking forward, right? So,

uh that's where VC investments are very helpful because it's telling you about confidence in the future potential. Again, these returns from the investments haven't been actualized yet. So you're that's always a good barometer of uh confidence in future potential. If you're looking at things like deployment, that's a very good barometer for where the market is at today in

terms of readiness to absorb technology. I think in the middle you've got a few other things that are now actually quite well tracked and that's going to be offtake agreements. So, say you're setting up a pilot plant of something like uh a new type of battery. It's going to be very capital intensive. You

probably don't have you haven't exited or sold the company yet. So, you don't have a return on those investments for your investors yet, but you've got committed offtakers. Might be an automotive OEM, might be another battery company agreeing to purchase your batteries when they come off the line.

um that is I think today becoming a very good barometer of that middle period things where you'd have trouble measuring in terms of deployment or products in the field but it's kind of starting to tell you where the needle is moving from initial investment out to realization of revenue.

Got it. So, um, la last, uh, last thing on this point, which 30 minutes in, you know, we're on the the the first pillar, which is hilarious. I this is, uh, you know, really, uh, fascinating to me, and I I really appreciate, uh, you know, how we've navigated this so far. But uh one

other I guess uh narrative that I have consumed and that I think is cool, but I'm curious if this is what you guys also see is that when we talk about clean tech history, um you know, depending on who you'll read, there's like we're in phase two or phase three or something like that. But overall what

I've read is that somewhere in between let's say maybe 2005 2010 to like COVIDish there was a hu like the 2010s I'd say there's a huge deployment of uh hardware and a lot of investment in physical products and companies deploying things that could capture data uh in a high quality way um I guess

broadly speaking and then once A bunch of that infrastructure was laid in a bunch of different areas, you know, whatever the application was in whatever industry. Uh once that infrastructure was there, the hardware infrastructure, then there was the capability for software companies to come in and say, what are we going to do with this data?

What particular use cases can we use this for? and how can we actually take this data that we're that we're uh you know measuring in uh crazy amounts and make it usable um not only for uh potential compliance or make uh regulation more effective but uh to help companies make better decisions and so

then I guess again loosely speaking since 2020 or so then it's like phase two of clean techch is all these software companies and and and data um uh clarification whatever companies is that I guess a theme that you guys see.

Would you talk about it differently? Is it even useful? No, I think it's a useful general construct. Um, you know, you'll hear the term a lot clean techch 1.0 referring to in the early as things like when solar, batteries, bofuels, wind were first coming into the market uh and really were kind of in many ways new

innovations at the time. We don't use that terminology of clean techch 1.0 0 and 2.0 and the reason is we consider clean techch to be a theme not an industry and we also see this as just being a continuous evolution energy transition mobility transition transition into cleaner chemicals these are multi-deade journeys and that's

where I think it is super important as we had covered at the top to just not overindex on one year or one quarter it's important to understand that but putting it into the broader context of where things have been, where they're likely to go is ultimately what's going to facilitate better decisions. And you

know, I think something that's certainly changed my mindset on that is accumulation of years of talking to corporates who think in many cases in decades whereas investors have a different mandate. They need to think in years and if you're trading on the public markets, people are thinking quarters, maybe weeks, right? So I think

having that uh diversity of opinion and perspective helps shape the thinking. To answer your question more directly, I think you had that early wave of cleaning tech which was solar, wind, bofuels, batteries and that you had its bubble and burst when I was coming into this space in 2019.

there was kind of this uh reawakening after what the after the so-called uh clean web of things like virtual power plants, distributed energy management, uh software for managing rooftop solar and prospecting. I came into clean tech group really at the tail end of that and then got in at the time when there was a

renewed enthusiasm around hardware and that was happening across the board which was a really interesting time if I think back to just precoid because you had folks saying all right well we've got a good track on the renewable energy that's still not continuous clean firm base load power let's start to reexplore that and That's where you saw things

like enhanced geothermal come back into the frame. Something we just covered quite a bit in our uh clean tech forum North America last week was look six seven years ago when we would raise nuclear fision you had a mix of disbelief and indignation from our clients that some would say well that's not pure clean tech this should just

should be renewables and only renewables and other people would have been jaded from the years of inactivity and then some cost overruns in the US on uh deployment of fision who said well it it's just not going to work Okay. But you started to see more innovators come into that space. Now you're seeing that

in full force. Fision, fusion, geothermal, right? And that started to really uh percolate back in I'd say 2019 2020. You also had this other thing happening which was people looking outside of energy uh and looking uh quite wide. I think one of my first projects at Clean Tech Group was on battery recycling and

that was my first exposure really to just how complex the material supply chain is, how sensitive it is and how easily disrupted it could be and now that is uh you open the Wall Street Journal any day and critical minerals is it's on the front page every day right so that start that shift started a few

years ago and that's where I would say that's the phase we are still And we've had a little bit of an eb and flow where other things got crowded in things like uh hydrogen, things like carbon capture. There was a little bit of an agricultural uh you know agricultural crop inputs and fertilizers renaissance in there too.

Electric mobility. You've had some eb and flows. But I do think this shift that kind of started around 2019 2020 of saying well what's the next wave of clean power going to be? and it's got to be this clean firm base load but there's multiple flavors to it that started then and also this thought process around all

right in a more electrified economy electric vehicles more consumer electronics batteries is a viable medium of backup storage we just need way more materials and we're just not stable on the supply chains that all started a few years ago so I still think we're on a continual arc from that period right let me pause there before I

get too carried away with it. No, no, good. Well, um, ju just because the the opportunity presented itself, I'm going to jump ahead in my little scribbled itinerary here and I'm I'm going to I'm going to say what how do we understand I mean you started to explain it um, you know, in a

way that makes total sense about uh, the story of critical materials, the the the story of critical resources. as you said, it's tied uh very uh very tightly to the electrification of an economy and the need for materials and things like this. Um was there something that happened? Was there uh a particular

chain of events that happened or was it something that just evolved over time where all of a sudden you know uh corporate leaders, policy leaders, everyone just looked around and was like whoa like this is happening like we are now at the point where you know we see in the in the near future

electrification uh you know from whatever direction EV storage like renewable energy sources uh you know these things are coming and uh you know we need to do something about it. So I I guess you know is was it was it an event or a series of events or was it something that was bigger picture

that created this this shift in thinking and there and this downstream uh you know market and industry activity. Well I think there is there's a few things there is that the world just got better at producing batteries and if you look at I think the latest estimates were something nearund $100 per kilowatt hour for a battery. um

you might want to check that and verify, but um you know that that's basically a 20fold drop since 2025 and you've been just on this you know straight downward angle in terms of battery costs because you know the industry just got smarter in terms of learning effects economies of scale and when that happened you know

people started to come around to the idea that EVs no matter how far we are on adoption they're going to get cheaper And because EVs at the end of the day are just they're they're a giant battery. Um, and if that gets cheaper, there's going to be more EV adoption. There's going to need to be more material

supply. And if you're not if you're an automotive OEM and you'll have oversight over your supply, you're going to have challenges. I think that was starting a few years ago. Then you look out at the multitude of applications, things like defense where rare earths play a significant role. So that's why rare earths have been in the spotlight so

much and just the fact that China really owns the majority percentage heavy majority dominant majority of refining capacity many of the materials lithium for example uh you know cobalt which was a is there a reason for that they've built up the capacity uh and that's just you that's a matter of national strategy in many cases okay

is in many cases China was uh really specialized in the upgrade trading of raw materials which tend to be very dirty industries by the way. Uh that's the import of raw materials, processing, managing waste streams up to inputs for electrical components. Was it was it something that uh you know the that them

as as a country or you know whoever needed to decide I guess you know was it was it just a matter of like you said national strategy it's some they were just earlier it was just a bet that ended up working out so I guess it kind of varies or I would put it through two lenses in

some ways it's absolutely a strategic move you China back into the early as was looking at things like electric vehicles and essentially positing that this would be a great way to break dependence on the outside world for energy.

China's heavily dependent on oil imports. So having more electrification of transport was going to be a way to break that dependence and having capacity to refine minerals was going to be a way to feed that industry. Also, China does have some strategic reserves uh of of um rare earth specifically, and you might

have to check me on this, but I think I recall uh there were directives going back to the Maadong days of wanting to develop these reserves into a strategic industry. Um so you know you develop the refining capacity and that becomes a critical step where they might be extracted in China but typically outside

of China then refined there. Um and it was just not an attractive industry in the rest of the world. Again these industries the the refining is very dirty. Uh it is not especially high margin in many cases. you're producing commodities and commodities tend to seek the lowest venue of production, the lowest uh or lowest cost venue of

production. So in that way I think it was overlooked in many cases in the west it was seen as something that was easily export or easily outsourced and as well um the industries the offtake industries were not picking up as fast here.

Okay. So um you know I can recall working at a consulting firm in China about this probably 10 years ago talking to a tier one supplier from outside of China who wanted to sell electric drivetrain technology in China and uh had essentially said well you know we have the technology it's just that

there's not a there's very few electric buses on the road in our home country. So you putting electric buses on the road in China this is just where we've got to sell them right now. um yeah this is going to be the opportunity for us to generate revenue from this IP. So I

think when you have all those factors coalescing you've got the capacity you've got the offtake demand owners these end industries which first was electrification in China um you know that buildup of capacity becomes a lot easier to maintain and it takes years to get these facilities online so that is where the rest of the world is catching

up. Thank you. Um, again, just another very very curious about that. I Well, I have this on freedom. It's just so cool. I get to ask these questions, so I appreciate you answering them in the theme of uh electrification and this seems like the direction we're going. So, you know, uh I'm still

extremely uh you know, personally nent in the uh in the space of vision, fusion, that type of energy. I've had some extremely informative episodes recently, people walking through the history um of fusion in the US globally, how how it works, where it's at now, things like this. There was a quote uh you know you can give your opinion but

there's a quote that uh where he said the ideal mix of nuclear in in in the energy supply of a grid is around 10 15% or something like that because the nature of nuclear is that it's running continuously and and it's not uh it's not a suitable energy source necessarily for something like a

data center potentially that that has different capacity needs at different times of the Okay. And so, um, you know, again, you can give your thoughts on that and I, if I'm remembering correctly, that's that's what he said. But as far as the idea of electrification without the perspective of people that just love fossil fuels,

because that's not an answer. But are there any other perspectives on where we're going? Like, are are there any are there any arguments against electrification in any type of way or is it really the only thing that's ahead of us?

Well, I think the first thing to understand is that electrification of any kind of endpoint and I'm thinking especially if things are battery based, these come down the cost curve very differently. They come down the cost curve like a power electronic. So, think of how expensive an iPhone was in just in nominal terms 15 years ago. It was

you it was probably $1,000. I don't know what it is today. It's probably uh you know probably about 500 500 some odd dollars. So it's come in half in nominal terms and then you think of in ter when you adjust for inflation how much $1,000 was worth 15 years ago versus today.

Um so you know I'm not going to give you a perfect number but I want to say it's it's three four times cheaper. That is the cost curve that power electronics come down. There's something called Moore's law which some of your guests might have expounded on and that's essentially the idea that on a

chip every year you can basically add more transistors in onto a chip and you're going to have a very fast increase in the compute efficiency of that chip. The same thing is true in many cases of batteries. So you know you're having the electrification of things like transport energy storage now um and that that's happening at data

centers too. a lot of lithium ion batteries going in and they just keep getting cheaper and cheaper. So, in that regard, I don't think there's very strong arguments long-term against electrification. You have some midterm frictions, right? Um, you're always going to hear charging and range anxiety on electric vehicles. It's a real concern if you're traveling distances,

but I think the average trip to work for an American is 9 miles. I think the average daily trip for somebody who's going to work, picking up kids, etc. is something like 40 miles. So, how much should we hem and haw over 300 m per charge versus 350?

It's these kinds of things where I think the technology is just outpacing public perception, frankly. And it is going to get cheaper because the batteries are getting cheaper to produce. the uh learning effects from producing a vehicle the finished vehicle are going to get better uh continually getting better. So in terms of you have a lot of

today arguments against electrification and I'm thinking of vehicles specifically a today argument being well it's more expensive than an internal combustion vehicle which is not always true actually and then the other argument might be something like the infrastructure is not ready um that obviously is changing as well because again vehicles are going to get more

efficient batteries get more power dense and I think there's going to be more people coming around the things like at home charging and chargers will get deployed a little bit So those frictions get reduced every year. Uh I think we are on a path to cheaper, more easily operated electric vehicles and you're going to have more

adoption as a result. Now what that does is that's going to create a totally new challenge of needing to supply more electricity versus just fuels or you know not just fuels but uh shifting fuels to electricity. And that's where you're going to have the challenge of base load power. you're going to need consistent

power into the grid and that's where things beyond wind and solar become really valuable. Uh you're seeing that at data centers data centers going and forward positioning themselves to someday take in uh electricity from nuclear fision someday fusion. You have power purchase agreements happening around that. Um another I point to here in the US which frankly feels like an

industry uh we have a good shot at being a winner in is enhanced geothermal. This is the idea that you're essentially using heat from the ground to boil water, spin a turbine, generate electricity. Um, and you've got some companies with real traction there. Back six years ago at Quint Techch Group, we said this is great for the 2030s, but

now you've got companies in operation supplying power commercially with uh enhanced geothermal. Uh they're getting power purchase agreements. You just saw uh FVO Energy file for an IPO about a week and a half ago. Um, there's real traction there. So, I would say that a direct answer to your question, there are immediate term arguments

against electrification, but I think those get weaker and weaker every year. Noted. Cool. So, make space in my household for storage batteries. Is that what you're saying? In many cases, that's practical. Okay. Um, I wonder if you can I don't know. Are big how big do these batteries need to be? Like can you make it like a

couch or something? Is that even safe? You know what I mean? In theory, you could. Yeah. All right. I'll keep that in the back of my head. I'll get back to you on that. So, uh quick quick sprint about this this uh this concept that you guys have, which is um if I'm not butchering it,

slow flow grow. Uh as far as understanding where different uh companies I believe are as far as um the pace at which they'll grow. Can you explain that that framework? Yeah. So, I'm going to explain it in reverse just cuz that's my muscle memory.

Do it. Um, we have this grow flow slow framework and essentially uh you know your viewers if they go download our global clean techch 100 you'll see that in kind of a bullseye chart. The outer ring being grow which are things we expect to accelerate in the coming year.

and accelerate I'm talking a holistic acceleration more adoption more deployment more investment ideally but just generally a a you know forward progress the flow ring in the middle are things we think will generally progress at the current pace might be lateral it might be in uh kind of incremental growth just the trajectory they're on

now maybe with a little bit of nuance that middle piece is slope things we think will face headwinds we'll see a drop off in deployment, uh, potentially a drop off in investments and become generally less attractive over the next year to innovators.

As I've characterized it for 2026, what we expect is a quote unquote pressure cooking effect. What I mean by that is I just kind of envision that bullseye as being in the center of a pressure cooker that gets tighter through the year. If you're looking at that grow ring, you're going to see a lot of technologies in

basically two thematics. The first thematic being the race to own AI infrastructure uh which is now very quickly overlapping with an argument for national security, national sovereignity. Everything in that value chain is getting pulled through into the market faster. Now that's things like vision, fusion, geothermal, they can all supply clean base load power to a data

center. That is things like a new industry that's been spurred around speed to power, which is modular standup of power um or bringing power to the site. Companies like Cruso Energy um Exawatt companies have gotten a lot of press over the past few years for doing that. There's a big pullthrough effect on chips and semiconductors that are

angling for energy efficiency. So I'm thinking things like uh photonix chips for inference as more inference start as more compute becomes inference and more inference moves to the edge. You've got everything happening in a data center that's going to be things like cooling that's going to be things like waste heat to power. And then you've also got

power electronics things that can be applicable in the grid or in a data center transformers high temperature superconductors all getting pulled into the market. So that's thematic number one. You see a lot of those in the grow ring. Thematic number two is going to be that emerging nexus between clean techch and national security and defense. You

see that very well reflected in the amount of critical minerals technologies that we have in that grow ring. And uh forgive me if I miss one, but certainly rare earths, lithium, uh copper are in there, as well as things like AI for mining. You've also got some other things that might be more dual use, not

just military supply chain. I'm thinking things like uh earth observation. A lot of earth observation technologies have had the environmental application for years. Think of things like methane sensing. If you can sense methane leaks from a satellite, you can probably sense troop movements too.

So those have long had that crossover, but now are getting a faster pull through effect. The challenge there, Blake, is when you've got two thematics and you've got demand signals coming from a few places, there's going to be much more competition. Everyone wants to get into these spaces. Now, every day I read a

press release about a new company that was born to do AI optimization. Maybe that is in some type of component. A lot happening now in software to manage AI uh data centers, the grids around them. Uh you know, I I think twice this week I've read about a seed round of a company that just came out of stealth. A

lot of new companies going in. And then also in this defensecritical uh critical minerals nexus, companies pivoting in there too. Companies that might have had in uh extraction or mining tailings treatment technology, maybe a battery recycling technology that they were angling at something else, but now they're angling for things like rare earths. They might they just

have a a process that can select for specific minerals. now whereas they were going after maybe steel refining before now they're going into critical minerals. So uh you've certainly got new entrance coming into that space and you've got a lot of folks pivoting in.

So that outer grow ring is just getting more intense. That's kind of pressure cooking effect number one. What that outer grow ring has been largely insulated against is things like high inflation is things like the geopolitics and the tariffs because these things just have such strong demand pull that they're just growing consistently but in

those center rings the flow and the slow I actually think a lot of those folks are feeling the geopolitics the politics national politics in the US and still the high inflation uh feeling that more acutely. So some of those areas that might be more capital intensive had maybe predicated some of their long-term

plans on having more tax credits on potentially input costs being a certain price. Now we're just seeing more fluctuation. Some of these things were dropping off prior to 2025, but I think our general hypothesis is you're looking at a lot of the things in the slow and slow rings. This is going to be a hard

year for those technologies to break out and see a faster than current pace growth. So, so when you're when you're placing uh when you when when you're deciding what to put in what ring, a lot of what you and I'm going to compress the end here, so uh you know, we'll uh we'll get

through the next couple questions, but um when when we're talking about where what to place in which rings, a lot of what you talked about was uh things that are happening around in the market and external factors. How important is it what's happening uh internally at a company um to to you? I mean, we could

talk about and and again, I don't know how feasible it is for, you know, for this to be in a research report, but the things I think about are like hiring. I mean, one thing you did talk about was how capital intensive a certain business model is. So, uh just external versus internal factors, things like that.

Uh I might start by framing it as we don't use the growth flow slow to uh to categorize companies. However, it is the analysis of companies that bottom up that ultimately informs that something we do do for our clients for the members to our market intelligence service is we actually go and score companies. We'll

do a breakdown of a given company and we will actually assign them a score on a zero to3 basis uh on innovation on cost competitiveness potential to scale ability to scale and then impact which we're defining as a combination of resource efficiency and resilience. So that's something that we don't publish.

We keep that for our members and of course the companies we evaluate are aware of it. Um, but it's the culmination of a lot of those exercises that gets us to the growth flow slow and it's it's a qualitative measure of how confident we are in the trajectory of these things. It's partially informed by

the investment momentum over the past year. Okay. It's very much so informed by some of the demand signals. Are some of these things too early to see things like a power purchase agreement or an offtake agreement? um are some of these things at the right maturity stage but just not seeing it.

And then you of course are going to look also at things like exits. So we saw a ton of mergers and acquisitions in the past year or so, you know, a ton relatively speaking um in cooling technologies for data centers. So that's just showing a clear demand pull. That's a corporate going and acquiring a

company. You also see things like IPOs and IPO filings in uh in Fision and in geothermal. So we expect a little bit uh more there. Energy efficient chips also seeing significant uh commercial traction. Just saw a huge licensing deal between Nvidia and a company Groank, $20 billion. Uh and then also a few recent

acquisitions. So we're indexing on the momentum, but then also the things we're hearing from conversations with people. Again, it's that human intelligence piece uh that informs that growth flow slow. So it is uh a combination of the quantitative up to that point but you know the quantitative only tells you what's happened up until today

the qualitative really helps you look forward. Cool. So on on the back of that I I have three final questions uh for the episode. The first one is uh and I'd love to do this per theme per industry per whatever uh category would make sense for you high level for someone that's building something for someone

that's thinking about it or you know four years deep into building their company. What advice would you give uh as far as what gets a company from 0ero to one or one to two this year or in general?

Or is there a difference? Wherever you want to take it. Yeah. You know, I think you got to kind of you have to be aware of how much is probably working against you in the macro economy and that's going to be things like uncertain trade environments which is going to mean uncertainty on your input costs. uh

there is still high inflation in many cases. So if you're launching, you're getting into commercial uh into a commercial phase or really wherever you're at, I do think that just going extremely lean on your costs is very important. And we've actually seen a bit of a trend in innovators over the past year where many of them are foregoing

the perhaps expensive firstofind projects or the big more flashy pilot projects with a corporate to basically say I'm going to contract manufacturer. I'm going to outsource a little bit. Uh, I might sacrifice a little bit of the utilization of my core IP or the maximization of that to get some parts off the shelf versus building out a

unique process because it's revenue today and maybe I have I'm not taking as flashy of a swing at this, but I'm going to build revenue a little bit faster just so I can get through this next year or so keeping investors on board more slowly acquiring customers. Um that is something that we're we're certainly

hearing and we're also hearing uh you know a totally different mentality um on the other end of the spectrum from people producing things like batteries and things like uh chemicals which is all right um you know corporates are really in a bit of a wait and see mode. Maybe you've got to circumvent them all together to not have

this high cash burn for the next year of waiting for a partnership to take hold or waiting for a partnership to turn commercial. Uh, and how that's manifesting is I I talked to a few investors last week at our forum who said, "We're willing to put more money in to see somebody go and just do the

whole thing versus them going and producing a component or an OEM piece of equipment. We do think there's going to be a faster path to revenue by just spending more and doing the whole thing. But there's no reason these two ideas can't come together, right? You can go and you may have a great lithium

refining technology, but your backers say it's going to take too long for the refiners to adopt your technology. Go and just produce lithium and sell that. Uh you're going to get more money to do that. And you can probably take some things off the shelf. you can probably do a few uh you know contract

manufacturing things to make your process fill out. So I think people are on one hand going a lot leaner in the decisions they make to getting to commercial traction and other spaces people are trying to compress time to commercial traction. Um so there's you know you can mix and match these approaches and then in some spaces

people are just going all the way in one direction or another. I think the uh assumptions that were present a few years ago that um you know high cost automatically e equals high output and uh you know your cost is going to have some linear relationship to your eventual revenue. I think that's really

melted away and people are becoming very practical. Last week at our forum in California I heard all kinds of very practical cost reduction arguments from innovators. Cool. Um cool. So I I would I would say for we've talked a lot talked the whole episode has been about where the industry is at, how everyone else is

building, what your guys' views are. Anthony, I'm curious for you and this is uh my second question out of the out of the three. What is the biggest hurdle that you're facing at the moment at at Clean Tech Group? And how is it also an opportunity?

I'd say the biggest hurdle is it's getting people to see beyond Let me rephrase it. It's getting people to go two steps ahead in their thinking and understand where the opportunities are going to be based on decisions today. I'll give a few examples. When we're talking to folks who are really interested in this data center space,

you still have some people kind of on the fence saying, should I get in? Should I not? You know, is this a bubble? Is it not? I think if you're not already getting into the space as a supplier, as a corporate acquirer, you're likely missing the boat. You don't have two years to let it develop.

I think it'll still be hugely lucrative in two years because even if the current AI model shift or something changes, look, a lot of this is an infrastructure play and you're going to get yourself in and be owning some of the infrastructure earlier than some of the demand. I'll give a totally different example is a

thematic that we really kind of always try to hammer home is that of adaptation and resilience. That's adaptation to climate change effects and then that makes you more resilient to them, right? Uh and this manifests across a few technologies. It can be wildfire detection and uh wildfire intervention.

It can be things like flood resilience. It can be things like uh grid hardening and then also um it can be things like parametric insurance. I always anybody talks to me about this knows has probably endured my lecture that this is serially underengaged criminally underengaged and if you believe a few things if you believe that extreme

weather is going to continue compounding that there's going to be more damage and if you believe that most people are behind the curve which I think most of the data will tell you that's the case you've got to believe that there's a huge opportunity for these technologies I do think that this is an area where um

you know we find ourselves not just, you know, members to our research service, but also the general public when we're out giving presentations. Um, you know, I frankly feel like we're shaking people by the shoulders a little bit and saying this this is going to be it there. We're we're going beyond the 1.5 warming world

and the weather events you see this year are just going to repeat themselves every year. So, there's good technology out there. Uh, and there's folks who are going to ultimately make who are going to launch very successful businesses by being ahead of the curve. This is where we constantly encourage corporate adopters to start engaging those.

I'm I'm glad you made the distinction between adaptation and resilience. I just read a post today. Are you familiar with Louis Woodall at Climate Proof? I don't think we know each other. No. Anyway, well, he's he's cool and he puts out great work and his publication is all about uh climate adaptation and uh

he just had a post today where he responded to a Bloomberg reporter that made resilience and adaptation uh seem like the same thing and I just wanted to say I appreciate that you made the distinction because resilience is the outcome of adaptation technologies and I think that's awesome.

So uh so that is uh you know definitely a huge hurdle and uh hopefully you know uh a good opportunity. So uh finally at the end of this incredible wonderful episode I'm so grateful for your time. I'm curious what inspires you? Well, I think it's this is a space where you see gradual and then all at once progress,

right? I think in some of these areas like I gave the example like geothermal um you know we we talked to members to our research service for years about this and it felt very gradual and now it's all at once. Um so you know it's a space that frankly rewards patience but it requires a lot of patience. it

doesn't have those constant maybe uh big headline things that things like enterprise software might have or social media. Um you do have these long really kind of grinding periods where things are incrementally progressing and as an analyst you still got to keep pace of them uh try to understand where their signals and then you start to see very

fast progress like some of the things you've seen in recent years on clean base load on critical minerals. So, that's always very rewarding. And I think that generally speaking, it's a downto-earth community. Uh, when I think of things like our clean tech forums, there's no VIP section. The speakers aren't in a green room. Everybody's

mingling with everybody. And frankly, a lot of good collisions happen. But, you know, I hear that every year when we come back from our forums is, I met an investor there. Or a corporate says, I actually found the solution I was looking for. Um, and some of that is collisions we facilitate at Clean Tech

Group. Otherwise, it's a lot of just, you know, a benefit people get from being part of our community. So, that's very rewarding and it's something where, again, the accumulation of those experiences allows me to look back at my time here and really see material progress in a lot of these spaces.

That's awesome. That is super cool and inspiring to me. I also shout out for I think it was unintentional but the punny said down to earth rare m r r r r r r r r r r r r r r r r r r r r r r r r r r r

r r r r r r r r r r r r rare materials hilarious a lot of good collisions fusion vision I forget which one it is but that's also good which one is it by the way which one it's it's yeah fusion fusion is combining all right good is a fusion fun well done

totally there you go look it's just it's just in you Anthony you just got it uh what if anyone else was inspired um you know to follow along or get in touch outside of downloading uh your report because I highly recommend I've read it a bunch of times very insightful and you know

there's like 50% of my questions unasked so it's very very informative um what's the best way to get get in touch yeah feel free to follow us on LinkedIn uh also feel free to reach out anytime to research.com and I would highly encourage anybody listening to this to listen to the I believe Blake five follow on episodes

with our with our analyst team where you're going to hear much smarter insights and you're going to get down into the nitty-gritty of a lot of these spaces. That's right. Good plug. I like that. Yeah, I'm just I'm more excited than anybody for it. So, but Anthony, thank you so much for your time. This was

incredible. Uh I'm excited for uh the next one. So, thank you. Thank you for having me.