Market Mad House

In individuals, insanity is rare; but in groups, parties, nations and epochs, it is the rule. Friedrich Nietzsche


Fusion company raises $500 million

A fusion company claims to have raised $500 million from private investors. Those investors include Peter Thiel and Sam Altman.

In fact, CNBC claims Y Combinator founder Sam Altman invested $375 million of his own money in Helion Energy. Altman is now the CEO of Open AI, the artificial intelligence (AI) research organization he co-founded with Elon Musk. As far as I know, Musk is not investing in Helion Energy.

Helion Energy will invest the $500 million to build a reactor that could generate electricity from fusion, The Financial Times reports. Helion’s Chief Executive Officer David Kirtley says the reactor uses technology similar to a Tesla vehicle’s braking system to make electricity with kinetic energy.

TechCrunch claims Helion has commitments for another $1.7 billion in investments. If that claim is true, Helion could receive up to $2.2 billion, or more than all the known private investment in fusion. The Fusion Industry Association estimates private individuals and organizations invested $1.7 billion in fusion before October 2021.

TechCrunch did not say where the additional $1.7 billion will come from, or when they will invest it. Note: no other publication mentions the additional $1.7 billion, which makes the story questionable.

Fusion and Kinetic Energy

The hope at Helion is to create a fusion reactor that can generate electricity without steam. Most proposed fusion reactors will use heat to make steam to run a turbine to generate electricity.

Helion claims this system could generate power at a cost of 1¢ per kilowatt hour (KHW), The Financial Times notes. In contrast, the average price for residential electricity in the United States is 13¢ per KHW,The Financial Times estimates.

The Helion team hopes to test the reactor by 2024, The Seattle Times reports. They will locate the reactor in Everett, Washington.

Helion will first build a facility to create the rare element Helium-3. They will need Helium-3 for Helion’s magnetic fusion process.

Is Peter Thiel Investing in Fusion?

Ajay Royan and Peter Thiel’s Mithril Capital raised the $500 million for Helion Energy.

Thiel is the notorious billionaire who helped found PayPal (PYPL), founded Palantir (PLTR), and attracted controversy for his support of former President Donald J. Trump (R-Florida). Thiel was an early Facebook (FB) investor. It is unclear how much money Thiel invested in Helion.

Mithril Capital is a venture capital firm that invests in technology businesses. The Financial Times claims the $500 million is the largest known private investment in fusion.

Helion claims its technology has achieved energy recovery with 95% efficiency. They also claim to be the first private company to have created plasma with temperatures of 100 million degrees Celsius. Helion claims its magnets have exhibited compression fields of over 10 Teslas. They also claim to have developed a complete self-supplied Helium-3 fuel cycle.

Fusion Investors

Helion’s technology includes a plasma accelerator that can heat plasma to 100 million degrees Celsius and a generator that extracts electricity through kinetic energy. They create the plasma with Deuterium and Helium-3 and contain the plasma with a Field Reversed Configuration.

Helion’s list of investors includes Mithril Capital, the Capricorn Investment Group, Y Combinator, Sam Altman, Dustin Moskovitz, and Reid Hoffman.

Reid Hoffman is the cofounder of LinkedIn and a partner in Greylock Partners, a venture capital firm. Dustin Moskovitz was a cofounder of Facebook (FB) with Mark Zuckerberg and others.

If the claims are true, Helion Energy could be the world’s best capitalized fusion company. Hence, Helion could raise enough money to conduct fusion experiments.

Helion’s Fusion could be worth Big Money

I think Helion’s fusion could be worth big money if it works. For example, I think Helion’s device could be an excellent power plant for a ship or a submarine.

A system that can generate electricity without steam or a turbine could be cheaper, smaller, and more efficient that existing power plants. One advantage to Helion’s system is that they will not require pipes,  or turbines which cost money and take up space.

Hence, Helion’s generator be smaller so you could put it on a ship or in a building in a city. Another advantage to Helion’s system is that it will not require enormous amounts of water to make steam for a turbine. A disadvantage to Helion’s system is that it will not generate steam for heating.

I think the real reason Thiel, Altman, Hoffman, and Moskovitz are investing in Helion is that it could make big money. Fusion could be a smart speculative investment for those wealthy men – if it works.

Helion could make billions of dollars through Navy contracts and the replacement of coal, gas, or nuclear power plants if its executives claims come true. However, until then investment in Helion is pure speculation.

Helion is definitely a fusion company to launch. If the claims its promoters make are true.