Buy Gundo
Where you can stumble upon a rain god
A peek inside today’s Diary:
Inside Isaiah Taylor’s cigar lounge
Turning air into jet fuel
WE WILL WIN
Follow the SpaceX mafia
Blood drones over Africa
"Red Bull?"
Usually we’re offered water before a meeting. Valar Atomics’ secretary offered us a Red Bull at 4pm. Says everything you need to know about the energy in El Segundo, CA.
This place is special, the next Silicon Valley. I’m convinced the next trillion-dollar companies are hatching here.
El Segundo is named after Standard Oil’s “second” oil refinery, now owned by Chevron. It is massive – the west coast’s largest refinery. ROS co-founder
and I went on a run around its 6-mile perimeter. It still pumps out 300,000 barrels a day.I’m sure conservationists would love to shut this thing down. So would many of the hard-tech founders we met… but for different reasons. These guys want to make the old ways of making energy obsolete.
Valar Atomics makes small nuclear reactors (SMRs). But instead of simply generating electricity, it will use the energy to pull carbon out of the air and produce synthetic oil and gas. This would:
Turn oil into a renewable resource
Why this audacious business model? Old school nuclear is massive, 500+ acre plants surrounded by concrete. Nuclear 2.0 is small, safe, school bus-sized reactors that can power a town. We already have this technology. Valar’s prototype is ready to turn on. The only thing standing in the way is regulation.
The biggest hurdles are the regulations policing potential nuclear reactor sites. It is extremely hard, slow, and expensive to pass the environmental review needed to establish a new nuclear site. Mindbogglingly, SMRs are subject to the same site regulations as old school massive nuke plants.
SMRs are meant to dramatically reduce the cost and time to get a new nuclear reactor up and running. But under current regulations, they make nuclear’s cost problem worse – because each SMR needs to sit somewhere.
Valar’s solution is to put hundreds of SMRs in one place – hundreds of identical small reactors clustered on a single "gigasite." Not one behemoth, but an army of identical twins working in harmony.
A gigasite will produce far more energy than could possibly be used in one location – even by a huge energy-hungry data center. The energy must be stored. Battery technology is nowhere good enough yet. So, Valar is going to store the energy in oil and gas.
We met Valar’s founder Isaiah Taylor upstairs in his cigar lounge. Leather armchairs anchor the room. Four enormous classical paintings span the wall. Columbus sighting land, Pilgrims stepping off the Mayflower, the signing of the Declaration, and the Constitutional Convention. This is a startup built on American ambition.
At age 25, Isaiah recently welcomed his fourth child. I thought I was crushing it with three kids by 30. But Taylor operates at a different velocity, chasing his mission "to make the world's energy." It's in his DNA. His great-grandfather built the first nuclear reactor at Oak Ridge in 1943.
That original reactor went from blueprint to completion in just nine months. Isaiah is determined to match that wartime urgency in peacetime.
Downstairs, he shows us Ward Zero, Valar's first reactor prototype. With just seven moving parts, it looks more like a sleek industrial water heater than the complex nuclear beasts of previous generations. The inside is beautiful. It looks like a video game studio, complete with high-def screens and neon yellow lights.
The reactor is ready to turn on. Again, the only thing standing in the way is regulation.
This place is a good reminder that:
The bedrock of prosperity is abundant energy.
Valar bets nuclear will deliver it. Casey Handmer thinks otherwise.
Casey talks fast, like someone who knows there isn't enough time in the day to explain all the ideas ricocheting around his brain. I first met Casey, founder of Terraform Industries, in Berkeley last October. This time I visited him at his Castle-shaped factory in Burbank, next-door to Walt Disney’s original studio.
Terraform is making natural gas from sunshine, water, and air. Its machine, the Terraformer, is a portable chemical plant powered by solar panels. No drilling. No pipelines stretching across continents. It’s essentially a bottomless energy well powered by the sun.
Casey used to work at NASA. One day he was doing calculations to figure out how to build a city on Mars. He realized the tech he was working on could solve Earth's biggest problems.
"We don't need to rebuild civilization from scratch," Casey explained over lunch. "The world already runs on hydrocarbons. We just need to make them differently."
Terraform’s initial goal is to make jet fuel, to power supersonic flight, from air. His “Terraformer” machine is roughly the size of two shipping containers and works like a reverse power plant. Sunlight and air go in one end, and cheap natural gas comes out the other.
"Solar cells are panes of glass that print wealth. By 2040, 95% of our energy will come from solar powered sources,” he says with total conviction. Who am I to disagree?
As our lunch wrapped up, Casey was already three topics ahead. He detailed how Terraform's technology could eventually pair with desalination to turn barren deserts green, a true terraforming of Earth's wastelands.
I love Casey’s vision for the future. Saudi Arabia without the drilling. Texas without the oil rigs.
The entrance to Terraform’s lab reads “WE WILL WIN.”
This is just a taste of the startups we met. In Gundo you literally stumble upon innovation. Walking to meet the founder of AnySignal, we pushed through the wrong door into Rainmaker's lab, where modern-day rain shamans are attempting to squeeze water from the sky.
We wrote about Rainmaker a few months ago. It’s revolutionizing cloud seeding, the technique that makes clouds rain on demand.
Imagine pre-emptively moistening wildfire-prone areas in California before blazes can start. Picture Phoenix transforming into an oasis, complete with lakefront property where worthless sand once baked under the sun.
Where else can you randomly stumble upon a rain god?
Lessons from Gundo’s entrepreneurs
#1: Follow the SpaceX Mafia. The PayPal Mafia (Musk, Thiel, Levchin, Hoffman) went on to build companies like Tesla, SpaceX, LinkedIn, Palantir, and Affirm. These ventures generated trillions of dollars in wealth for everyone involved.
The group to watch now is the SpaceX Mafia. SpaceX is the world’s most valuable private company, valued around $350 billion today. The ventures its alumni create, focused on atoms, energy, defense, and space, will dwarf that figure.
SpaceX’s nearby headquarters in Hawthorne employs 10,000 people. SpaceX alumni are everywhere in Gundo. They all graduated from the School of Elon Musk, imbued with a culture of rapid iteration and the motivation to achieve difficult goals.
#2: Audacity. I’m convinced these startups are vying for the most audacious goal. Build the world’s largest nuclear power site. Turn air into jet fuel. Rain on demand.
It’s no surprise people from all over the country (and the world) move to Gundo. “Hey kid, wanna build rockets two miles from the beach?”
#3: Beauty. Michael Smayda, co-founder of hypersonic startup Hermeus, worked for Elon Musk as one of the lead designers on SpaceX’s Falcon Heavy rocket. Elon demanded the engines be a shiny metallic color. This created engineering challenges and served no purpose other than to look cool.
But Elon understood the importance of building beautiful, inspirational things. That’s how you attract smart kids raised on software back to the world of atoms.
#4: Agency. The world gets better not by accident, but because determined people are making it happen.
The vibe in Gundo is: If the tools don't exist, build them. If the process is broken, reinvent it. Many founders here are high school or college dropouts.
You’ll see them on the cover of Forbes magazine someday. But you read about them at the Rational Optimist Society first.
#5 Bonus: Buy Gundo real estate. There’s a joke that most venture capitalists waste their time betting on longshot startups when they could’ve simply bought Nvidia stock and made more money.
I left El Segundo bullish on many of the founders I met. But the no brainer way to profit from America’s hard tech renaissance is to buy a condo in Gundo. Think of it like “buying the index.”
Silicon Valley was the most important place on Earth over the past two decades during the software-dominated bull market. El Segundo is becoming the most important small city in America as we head into the hardware and defense boom.
Trillion-dollar companies will be built here.
Do you have ambitious kids?
Or grandkids? Tell them to visit Gundo. They may fall in love with the town like I did.
As the innovation avalanche accelerates, even the baristas here will do well, caffeinating innovators like Ted…
It’s 5:30pm on Friday in downtown El Segundo
I'm watching Ted Feldmann and his team at Durin tackle a national security crisis hiding in plain sight. And they’re doing it with the kind of pragmatism America used to be famous for, starting quite literally from the ground up.
Many of the manmade things around you – from the phone in your pocket to the walls of your home – start as rocks, metals, and minerals in the ground. But the ways we discover and mine these critical resources are stuck in the 1950s.
It’s also dirty, dangerous work. That’s one reason America now relies on China and the Democratic Republic of the Congo for many of the inputs we need for everything from batteries to fighter jets.
Meanwhile, half of America's mining workforce will retire by 2029. Yet we need seven times more of certain metals and minerals to build the greener future we all want. Someone needs to find these critical resources faster, cheaper, and with smaller crews.
This is where Ted Feldmann comes in. He’s building something that should've existed decades ago: smart drilling rigs that work without constant human babysitting.
"Until now, we've just ignored the data," Ted tells me, as he leans against a massive diamond drill stretching across Durin’s warehouse floor.
Durin's rigs capture everything from how fast the drill turns, how the bit vibrates, how the rocks react. They stream this data to geologists who could be sitting in an office thousands of miles away. What used to be wasted information becomes an underground treasure map.
When the drill hits something interesting, it adjusts itself. No waiting for human orders.
What struck me most was Teddy's obsession with this obscure problem. Growing up in a drilling family, he's spent years thinking about how to drill and mine smarter.
Durin isn't run by Silicon Valley bros trying to "disrupt" an industry they googled last week. They're deeply knowledgeable engineers who respect mining's traditions while refusing to accept its limitations.
This is the kind of innovation that doesn't make flashy headlines but helps America rediscover its industrial mojo.
It’s funny how the most revolutionary ideas are often the most obvious ones. You just need someone obsessed enough to make them happen.
I’m excited to see Durin’s robo drills in action. Ted is one to watch in our Innovator’s League.
Discover more innovators on our podcast
Innovation is America’s superpower. It’s how we get American drones delivering lifesaving blood in Rwanda and Walmart orders in Texas. Hear more about the tenacious innovators making this all happen – and other inspiring stories about the world’s best problem solvers – on the latest episode of the Rational Optimist podcast.
Listen in here on Substack, or wherever you get your podcasts.
You can also watch the episode on YouTube by clicking here.
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Stephen McBride is a co-founder of the Rational Optimist Society.
I'm 81 years old and every time I read these reports, I want to live another 81 years to see what happens in the future! It all sounds fantastic!
Always good positive innovation...thanks for the continuing updates on progress...