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Riot Games updates its privacy notice to start developing voice comms moderation

Anyone who has played a video game with voice chat in the past decade knows that there is some risk involved. You might be greeted by friendly teammates, but you may also hear some of the most toxic language you’ve ever heard in your life.

Riot Games, the game developer behind ultra popular titles like League of Legends and Valorant, is thinking hard about this. And taking action.

The developer is today announcing changes to its privacy notice that allow for it to capture and evaluate voice comms when a report is submitted around disruptive behavior. The changes to the policy are Riot-wide, meaning that all players across all games will need to accept those changes. However, the only game that is scheduled to utilize these new abilities is Valorant, as it is the most voice chat-heavy game from Riot.

The plan here is to store relevant audio data in the account’s registered region and evaluate it to see if the behavior agreement was violated. This process is triggered by a report being submitted, and is not an always-on system. If a violation has occurred, the data will be made available to the player in violation and will ultimately be deleted once there is no further need for it following reviews. If no violation is detected, the data will be deleted.

Before we go any further, let me just say that this is a big fucking deal. Publishers and developers have long known that toxicity in gaming is not only a terrible user experience, but it’s actively preventing large swaths of potential gamers from dedicating themselves to it.

“Players are experiencing a lot of pain in voice comms and that pain takes the form of all kinds of different disruption in behavior and it can be pretty harmful,” said Head of Players Dynamics Weszt Hart. “We recognize that, and we have made a promise to players that we will do everything that we could in this space.”

Voice chat often makes games much richer and more fun. Particularly during the pandemic, people are craving more human connection. But in a tense environment like competitive games, that connection can turn sour.

As a gamer myself, I can safely say that some of the most hurtful experiences of my life have been while playing video games with strangers.

To be clear, Riot isn’t getting specific with how exactly this voice chat moderation will work. The first step is the update to its privacy notice, which gives players a heads up and gives the company the right to start evaluating voice comms.

It’s incredibly difficult to police voice comms. Not only do you need to be transparent with users and update any legal documents (which is arguably the easiest step, and the one Riot is taking today), but you must develop the right technology to do this, all while protecting player privacy.

I spoke with Hart and Data Protection Officer and CISO Chris Hymes about the changes. The duo said that the actual system for detecting behavior violations within voice comms is still under development. It may focus on automated voice-to-text transcription, and go through the same system as text chat moderation, or it may rely more heavily on machine learning to actually detect an infringement via voice alone.

“We’re looking at the technologies and we’re trying to land on the one that we want to launch with,” said Hart. “We’ve been putting a lot of time and effort into space and we have a pretty good idea of the direction that we’re going to take. But what we want to do is to have some audio to work with, to better understand if any other approaches that we’re looking at are going to be the best. To do this, we need to be able to process something real, and not just make a good guess.”

To get to that answer as quickly as possible, he added, the first step of updating the privacy notice had to go into effect.

Hart and Hymes also said that some layer of human moderation will be involved to ensure that whatever system is being developed is working properly and can ultimately be rolled out to other languages and other titles, as the system is initially being developed for Valorant in North America.

Advances in machine learning and natural language processing are making that development easier than it was 10, or even two, years ago. But even in a world where a machine learning algorithm could accurately detect hate speech, with all its nuances, there is yet another hurdle.

Gamers, even from one title to the next, have their own language. There is a whole lexicon of words and terms used by gamers that aren’t used in every day life. This adds yet another complication to the process of developing this system.

Still, this is a critical step in ensuring that Riot Games titles, and hopefully other titles as well, become an inclusive environment where anyone who wants to game feels safe and able to do so.

And Riot is careful to understand that developing games is a holistic endeavor. Everything from game design to anti-cheating measures to behavior guidelines and moderation have an effect on the overall experience of the player.

Alongside this announcement, the company is also introducing an update to its terms of service with an updated global refund policy and new language around anti-cheat software for current and future Riot titles.

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Cloud gaming service Shadow taken over by OVHcloud founder

Blade, the French startup behind cloud gaming service Shadow, has been acquired by Octave Klaba’s fund following a commercial court order. Klaba is better known as the founder of OVHcloud, a French cloud hosting company. He’s acquiring Blade (and Shadow) through his investment fund Jezby Ventures — not OVHcloud.

Shadow is a cloud computing service for gamers. People can pay a monthly subscription fee and gain access to a gaming PC in a data center. You can connect to this PC from your computer, a smartphone, a tablet or a smart TV. You can see a video stream of what’s happening on the screen and your actions are relayed to the server.

Unlike Google Stadia, Amazon Luna or even Nvidia GeForce Now, you can install whatever you want on your server. You get a full Windows 10 instance so it supports anything from Steam to Photoshop and Excel.

While the French startup has raised more than $100 million across multiple funding rounds, the company couldn’t keep up with pre-orders, didn’t generate enough revenue to be self-sustainable and couldn’t find cash to expand its service. Despite attracting 100,000 paid users, Next INpact reported that the company had no choice but to go into administration with the commercial court.

Several companies and a group of people submitted takeover bids. In particular, Blade CTO Jean-Baptiste Kempf teamed up with other employees, while Octave Klaba submitted his own offer. Klaba plans to keep all employees except Jean-Baptiste Kempf.

Now, it’s going to be interesting to see how the service changes over the coming weeks. Subscriptions currently start at €12.99 per month in Europe or $11.99 per month in the U.S. It’s unclear whether Shadow will remain available at this price point, how specifications are going to evolve and if the company is going to spin up more servers to attract new clients.

 

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Sequoia’s Mike Vernal will share how to iterate with tempo at TC Early Stage in July

TC Early Stage is back in July and we have a fantastic lineup in store that’s laser-focused on marketing and fundraising. That includes, but is not limited to, Sequoia’s Mike Vernal, whose portfolio companies include Citizen, PicsArt, Whisper, Threads, Houseparty and more.

Vernal will be leading a discussion on tempo and product-market fit. The chat stems from Vernal’s experience as an investor, sharing the lesser-known keys to success to not only secure early investment, but to use it to secure a later-stage investment.

In essence, tempo is everything. At the earliest stage, investors are looking more at the team than the product, knowing that the likelihood of the product changing and evolving is high. That means that the ability to adapt — including the systems in place to collect feedback and willingness to continue iterating — are incredibly important factors.

Vernal will not only stress the importance of tempo and product iteration (and how it relates to fundraising success), he’ll also share how both enterprise and consumer companies should go about creating these feedback loops with customers and how to iterate quickly.

Vernal joined Sequoia as a partner in 2016. He currently sits on the boards of Citizen, Jumpstart, rideOS, PicsArt, Rockset, Threads and Whisper. Before Sequoia, Mike was VP at Facebook, where he led a variety of product and engineering teams. He co-created Facebook Login and the Graph API.

In other words, he’s seen and participated in success, and has done the work of product iteration himself.

Vernal joins a stellar lineup of speakers at TC Early Stage in July, including Norwest Venture Partners’ Lisa Wu, Greylock’s Mike Duboe and Cleo Capital’s Sarah Kunst, among many others that are soon to be announced.

One of the great things about TC Early Stage is that the show is designed around breakout sessions, with each speaker leading a chat around a specific startup core competency (like fundraising, designing a brand, mastering the art of PR and more). Moreover, there is plenty of time for audience Q&A in each session.

Pick up your ticket for the event, which goes down July 8 and 9, right here. And if you do it before the end of the day today, you’ll save a cool $100 off of your registration.

 

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Optimism reigns at consumer trading services as fintech VC spikes and Robinhood IPO looms

With the Coinbase direct listing behind us and the Robinhood IPO ahead, it’s a heady time for consumer-focused trading apps.

Mix in the impending SPAC-led debut of eToro, general bullishness in the cryptocurrency space, record highs for some equities markets and recent rounds from Public.com, M1 Finance and U.K.-based Freetrade, and you could be excused for expecting the boom in consumer asset trading to keep going up and to the right.

But will it? There are data in both directions. While recent information could indicate that some of the most lucrative trading activity at companies like Robinhood could be slowing, there’s also encouraging app download information that paints a more bullish picture regarding the durability of the boom in consumer interest regarding savings and investing, which The Exchange has had an eye on for some time.


The Exchange explores startups, markets and money. Read it every morning on Extra Crunch or get The Exchange newsletter every Saturday.


Our question today is this: How bullish are companies in the space about continued consumer interest in equities and other asset trading? And why? We’ll also put similar questions to their backers.

We’ve compiled notes from Accel’s Sameer Gandhi about views concerning Public as one of its backers and Index’s Jan Hammer about Robinhood and its market, as well as comments from Public.com and M1 Finance about what they see regarding consumer trading interest in the future. Thoughts from Robert Le, PitchBook’s senior emerging technology analyst, cap things off.

We’ll start with a short look at some data to help ground ourselves regarding where consumer trading demand appears to be today, then consider what the companies in the ring and their backers are thinking. We’ll close with a synthesis of all the perspectives to come up with hype-adjusted expectations for the rest of 2021.

Bullish data, bearish data

Coinbase executed its direct listing on the back of one of the most impressive quarters we’ve ever seen in the realm of business results, meaning it began to trade when it looked just about as good as a company can. Will the same hold true for Robinhood and company?

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Heirlume raises $1.38M to remove the barriers of trademark registration for small businesses

Platforms like Shopify, Stripe and WordPress have done a lot to make essential business-building tools — like running storefronts, accepting payments and building websites — accessible to businesses with even the most modest budgets. But some very key aspects of setting up a company remain expensive, time-consuming affairs that can be cost-prohibitive for small businesses — but that, if ignored, can result in the failure of a business before it even really gets started.

Trademark registration is one such concern, and Toronto-based startup Heirlume just raised $1.7 million CAD (~$1.38 million) to address the problem with a machine-powered trademark registration platform that turns the process into a self-serve affair that won’t break the budget. Its AI-based trademark search will flag if terms might run afoul of existing trademarks in the U.S. and Canada, even when official government trademark search tools, and even top-tier legal firms, might not.

Heirlume’s core focus is on leveling the playing field for small business owners, who have typically been significantly out-matched when it comes to any trademark conflicts.

“I’m a senior-level IP lawyer focused in trademarks, and had practiced in a traditional model, boutique firm of my own for over a decade serving big clients, and small clients,” explained Heirlume co-founder Julie MacDonell in an interview. “So providing big multinationals with a lot of brand strategy, and in-house legal, and then mainly serving small business clients when they were dealing with a cease-and-desist, or an infringement issue. It’s really those clients that have my heart: It’s incredibly difficult to have a small business owner literally crying tears on the phone with you, because they just lost their brand or their business overnight. And there was nothing I could do to help because the law just simply wasn’t on their side, because they had neglected to register their trademarks to own them.”

In part, there’s a lack of awareness around what it takes to actually register and own a trademark, MacDonell says. Many entrepreneurs just starting out seek out a domain name as a first step, for instance, and some will fork over significant sums to register these domains. What they don’t realize, however, is that this is essentially a rental, and if you don’t have the trademark to protect that domain, the actual trademark owner can potentially take it away down the road. But even if business owners do realize that a trademark should be their first stop, the barriers to actually securing one are steep.

“There was an an enormous, insurmountable barrier, when it came to brand protection for those business owners,” she said. “And it just isn’t fair. Every other business service, generally a small business owner can access. Incorporating a company or even insurance, for example, owning and buying insurance for your business is somewhat affordable and accessible. But brand ownership is not.”

Heirlume brings the cost of trademark registration down from many thousands of dollars to just under $600 for the first, and only $200 for each additional after that. The startup is also offering a very small business-friendly “buy now, pay later” option supported by Clearbanc, which means that even businesses starting on a shoestring can take the step of protecting their brand at the outset.

In its early days, Heirlume is also offering its core trademark search feature for free. That provides a trademark search engine that works across both U.S. and Canadian government databases, which can not only tell you if your desired trademark is available or already held, but also reveal whether it’s likely to be able to be successfully obtained, given other conflicts that might arise that are totally ignored by native trademark database search portals.

Heirlume search tool comparison

Image Credits: Heirlume

Heirlume uses machine learning to identify these potential conflicts, which not only helps users searching for their trademarks, but also greatly decreases the workload behind the scenes, helping them lower costs and pass on the benefits of those improved margins to its clients. That’s how it can achieve better results than even hand-tailored applications from traditional firms, while doing so at scale and at reduced costs.

Another advantage of using machine-powered data processing and filing is that on the government trademark office side, the systems are looking for highly organized, curated data sets that are difficult for even trained people to get consistently right. Human error in just data entry can cause massive backlogs, MacDonell notes, even resulting in entire applications having to be tossed and started over from scratch.

“There are all sorts of data sets for those [trademark requirement] parameters,” she said. “Essentially, we synthesize all of that, and the goal through machine learning is to make sure that applications are utterly compliant with government rules. We actually have a senior-level trademark examiner that came to work for us, very excited that we were solving the problems causing backlogs within the government. She said that if Heirlume can get to a point where the applications submitted are perfect, there will be no backlog with the government.”

Improving efficiency within the trademark registration bodies means one less point of friction for small business owners when they set out to establish their company, which means more economic activity and upside overall. MacDonell ultimately hopes that Heirlume can help reduce friction to the point where trademark ownership is at the forefront of the business process, even before domain registration. Heirlume has a partnership with Google Domains to that end, which will eventually see indication of whether a domain name is likely to be trademarkable included in Google Domain search results.

This initial seed funding includes participation from Backbone Angels, as well as the Future Capital collective, Angels of Many and MaRS IAF, along with angel investors including Daniel Debow, Sid Lee’s Bertrand Cesvet and more. MacDonell notes that just as their goal was to bring more access and equity to small business owners when it comes to trademark protection, the startup was also very intentional in building its team and its cap table. MacDonell, along with co-founders CTO Sarah Ruest and Dave McDonell, aim to build the largest tech company with a majority female-identifying technology team. Its investor make-up includes 65% female-identifying or underrepresented investors, and MacDonnell says that was a very intentional choice that extended the time of the raise, and even led to turning down interest from some leading Silicon Valley firms.

“We want underrepresented founders to be to be funded, and the best way to ensure that change is to empower underrepresented investors,” she said. “I think that we all have a responsibility to actually do something. We’re all using hashtags right now, and hashtags are not enough […] Our CTO is female, and she’s often been the only female person in the room. We’ve committed to ensuring that women in tech are no longer the only woman in the room.”

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Early-bird price ends tonight: Buy your pass to TC Early Stage 2021 and save $100

Last call, founders. Today is your last chance to save $100 on a pass to TC Early Stage 2021: Marketing & Fundraising. Our last founder bootcamp event of the year takes place July 8-9, and it’s time to call on Saint Expeditus — the patron saint of procrastinators and programmers alike. He’ll help you kick procrastination to the curb, save some cash and gain access to a bevy of top-tier investors, famous founders, marketing magicians, financial wizards and other startup savants. And they all want to help you build a better startup. But you need to buy your pass by 11:59 p.m. (PT) today, April 30.

This TC Early Stage experience goes deep on fundraising and marketing fundamentals. On day one, you’ll choose from a range of presentations and breakout sessions — all interactive, with plenty of time for Q&As. Plus video on demand, available after the event ends, means you don’t have to worry about schedule conflicts.

Speakers at Early Stage bring a wealth of experience, coupled with authenticity. You’ll walk away with actionable advice for immediate use and an unvarnished look at what it takes to build a startup. No sugar-coating here.

Vlad Magdalin, founder of Webflow, was very candid about the challenges he faced on his journey to success. “You always hear about startups that raise millions of dollars, but you don’t necessarily hear about the ups and downs it takes to get to that point. It’s important for early founders to see that side, too.”

We recently added Lisa Wu, a partner at Norwest Venture Partners, to our speaker roster, and we can’t wait to hear why she thinks founders should think like a VC. We’re adding more amazing speakers every week, and the full agenda is coming soon!

On day two, get ready for the Early Stage Pitch-off. Applications open next week! Throw your hat in the ring and maybe you’ll be one of the 10 early-stage startup founders chosen to pitch live in front of a panel of VC judges and all the Early Stage attendees around the world. Valuable exposure and pitch feedback for all competitors and special prizes for the winner. Stay tuned!

Read about Nalagenetics, the April TC Early Stage Pitch-off winner right here.

You procrastinated, dragged your feet and delayed taking action on this one simple, opportunity-filled task. For the love of Saint Expeditus, buy your pass to TC Early Stage 2021: Marketing & Fundraising before 11:59 pm (PT) tonight, save $100 and build a better startup.

Is your company interested in sponsoring or exhibiting at Early Stage 2021 – Marketing & Fundraising? Contact our sponsorship sales team by filling out this form.

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Sorbet raises $6M seed led by Viola Ventures to tackle the thorny financials of paid time off

A U.S./Israeli startup, Sorbet — which is tackling what companies do with the financial risks as employees accrue paid time off (PTO) — has raised $6 million in a seed funding round led by Viola Ventures, with participation by Global Founders Capital and Meron Capital.

The economics of paid time off is relatively hidden in the business world, but essentially, Sorbet takes on the burden of this PTO from employers and then allows employees to spend it. This gives the employers far more control over the whole process and the ability to forecast its impact on the business.

Sorbet says that in the U.S., employees use only 72% of PTO balances, even though it’s the most sought-after benefit. But this, effectively, comes out at 768 million unused days off a year, worth around $224 billion. This creates a difficult problem for CFOs and accountants because its creates balance sheet liabilities on the company’s books, says Sorbet. If the employee doesn’t use all of their PTO, the employer can end up owing them a lot of money, which creates a cash flow liability on the company’s books. So Sorbet buys out these PTO liabilities from employees, then loads the cash value of the PTO on prepaid credit cards for the employees.

Speaking to me on a call, CEO and co-founder Veetahl Eilat-Raichel, said: “We researched this whole idea of paid time off and found this huge, massive market failure and inefficiency around the way that PTO is constructed. It’s kind of one of those things where, on the face of it, there’s this boring bureaucratic payroll item that turns into a boring balance sheet item. But under it is a $224 billion problem for U.S. businesses… If you think about it, employers are borrowing money from their employees at the worst terms possible and employees aren’t benefitting either. So everyone’s hurting here.”

She said: “Sorbet assumes the liability on ourselves and so then we can allow the company to control their cash flow and decide when they want to pay us back. They gain a lot of financial value because we are able to be very, very attractive on our funding. So it saves costs, it provides them with complete control of their cash flow and it allows them to give out amazing financial benefits to employees at a time where we can all use some extra cash right now.”

The platform Sorbet has built will, it says, sync with calendars, HR and payroll systems, identify habits and then proactively suggest personalized, pre-approved 3-6 hour “Micro Breaks”, 1-4 day “Micro Vacations” and +1 week Vacations. This, says the startup, increases PTO used by as much as 15%.

Employers can constantly renegotiate the terms of the loan with Sorbet, thus matching future cash flow, insulating themselves against salary raises (wage inflation), and take advantage of other benefits.

The co-founders are Eilat-Raichel, who previously worked at L’Oréal, Lockheed Martin and a fintech entrepreneur; Eliaz Shapira, co-founder and CPO; and Rami Kasterstein, co-founder and board member.

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Cloud infrastructure market keeps rolling in Q1 with almost $40B in revenue

Conventional wisdom over the last year has suggested that the pandemic has driven companies to the cloud much faster than they ever would have gone without that forcing event, with some suggesting it has compressed years of transformation into months. This quarter’s cloud infrastructure revenue numbers appear to be proving that thesis correct.

With The Big Three — Amazon, Microsoft and Google — all reporting this week, the market generated almost $40 billion in revenue, according to Synergy Research data. That’s up $2 billion from last quarter and up 37% over the same period last year. Canalys’s numbers were slightly higher at $42 billion.

As you might expect if you follow this market, AWS led the way with $13.5 billion for the quarter, up 32% year over year. That’s a run rate of $54 billion. While that is an eye-popping number, what’s really remarkable is the yearly revenue growth, especially for a company the size and maturity of Amazon. The law of large numbers would suggest this isn’t sustainable, but the pie keeps growing and Amazon continues to take a substantial chunk.

Overall AWS held steady with 32% market share. While the revenue numbers keep going up, Amazon’s market share has remained firm for years at around this number. It’s the other companies down market that are gaining share over time, most notably Microsoft, which is now at around 20% share — good for about $7.8 billion this quarter.

Google continues to show signs of promise under Thomas Kurian, hitting $3.5 billion, good for 9% as it makes a steady march toward double digits. Even IBM had a positive quarter, led by Red Hat and cloud revenue, good for 5% or about $2 billion overall.

Synergy Research cloud infrastructure bubble map for Q1 2021. AWS is leader, followed by Microsoft and Google.

Image Credits: Synergy Research

John Dinsdale, chief analyst at Synergy, says that even though AWS and Microsoft have firm control of the market, that doesn’t mean there isn’t money to be made by the companies playing behind them.

“These two don’t have to spend too much time looking in their rearview mirrors and worrying about the competition. However, that is not to say that there aren’t some excellent opportunities for other players. Taking Amazon and Microsoft out of the picture, the remaining market is generating over $18 billion in quarterly revenues and growing at over 30% per year. Cloud providers that focus on specific regions, services or user groups can target several years of strong growth,” Dinsdale said in a statement.

Canalys, another firm that watches the same market as Synergy, had similar findings with slight variations, certainly close enough to confirm one another’s findings. They have AWS with 32%, Microsoft 19% and Google with 7%.

Canalys market share chart with Amazon with 32%, Microsoft 19% and Google 7%

Image Credits: Canalys

Canalys analyst Blake Murray says that there is still plenty of room for growth, and we will likely continue to see big numbers in this market for several years. “Though 2020 saw large-scale cloud infrastructure spending, most enterprise workloads have not yet transitioned to the cloud. Migration and cloud spend will continue as customer confidence rises during 2021. Large projects that were postponed last year will resurface, while new use cases will expand the addressable market,” he said.

The numbers we see are hardly a surprise anymore, and as companies push more workloads into the cloud, the numbers will continue to impress. The only question now is if Microsoft can continue to close the market share gap with Amazon.

 

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The second shot is kicking in

Hello and welcome back to Equity, TechCrunch’s venture capital-focused podcast, where we unpack the numbers behind the headlines.

First and foremost, Equity was nominated for a Webby for “Best Technology Podcast”! Drop everything and go Vote for Equity! We’d appreciate it. A lot. And even if we lose, well, we’ll keep doing our thing and making each other laugh. (Note: We are in last place, which is, well, something.)

Regardless, the Equity team got together once again this week to not only go over the news of the week, but also to do a little soul searching. You see, some news broke yesterday, so we figured that we had to talk about it in our usual style. So, here’s the rundown:

  • Do you want to buy TechCrunch? Apparently you can? Albeit probably along with a few billion dollars’ worth of other assets — whatever is left of Yahoo and AOL — you can now own an NFT. A non-fungible TechCrunch. What is ahead for us? We don’t know. So if you do know, tell us. Until then we’ll just yo-yo gently between panic and optimism, as per usual.
  • We also dug into the latest All Raise venture capital data, and the results were abysmal. 
  • Next up was the news that fintech startups are setting records in 2021, raising more capital than ever before. That brought us to the latest from Brex.
  • And then there was a suspicious trend when three fintech companies focused on teen banking raised in one exhale. We talk Step, Greenlight and Current.
  • Natasha talked about her last Startups Weekly post, in which she unpacked The MasterClass effect’s impact on edtech.
  • And to close, we discussed the latest cool-kid venture capital funds. Sure memes are cool, but did you know that they can help you raise a $10 million fund? They can!

We are back Monday morning with our weekly kick-off show. Have a great weekend!

Equity drops every Monday at 7:00 a.m. PST, Wednesday, and Friday at 6:00 AM PST, so subscribe to us on Apple PodcastsOvercastSpotify and all the casts!

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Geothermal technology has enormous potential to power the planet and Fervo wants to tap it

Tapping the geothermal energy stored beneath the Earth’s surface as a way to generate renewable power is one of the new visions for the future that’s captured the attention of environmentalists and oil and gas engineers alike.

That’s because it’s not only a way to generate power that doesn’t rely on greenhouse gas emitting hydrocarbons, but because it uses the same skillsets and expertise that the oil and gas industry has been honing and refining for years.

At least that’s what drew the former completion engineer (it’s not what it sounds like) Tim Latimer to the industry and to launch Fervo Energy, the Houston-based geothermal tech developer that’s picked up funding from none other than Bill Gates’ Breakthrough Energy Ventures (that fund… is so busy) and former eBay executive, Jeff Skoll’s Capricorn Investment Group.

With the new $28 million cash in hand, Fervo’s planning on ramping up its projects, which Latimer said would “bring on hundreds of megawatts of power in the next few years.”

Latimer got his first exposure to the environmental impact of power generation as a kid growing up in a small town outside of Waco, Texas near the Sandy Creek coal power plant, one of the last coal-powered plants to be built in the U.S.

Like many Texas kids, Latimer came from an oil family, and got his first jobs in the oil and gas industry before realizing that the world was going to be switching to renewables and the oil industry — along with the friends and family he knew — could be left high and dry.

It’s one reason he started working on Fervo, the entrepreneur said.

“What’s most important, from my perspective, since I started my career in the oil and gas industry, is providing folks that are part of the energy transition on the fossil fuel side to work in the clean energy future,” Latimer said. “I’ve been able to go in and hire contractors and support folks that have been out of work or challenged because of the oil price crash… And I put them to work on our rigs.”

Fervo Energy chief executive, Tim Latimer, pictured in a hardhat at one of the company’s development sites. Image Credits: Fervo Energy

When the Biden administration talks about finding jobs for employees in the hydrocarbon industry as part of the energy transition, this is exactly what they’re talking about.

And geothermal power is no longer as constrained by geography, so there are a lot of abundant resources to tap and the potential for high-paying jobs in areas that are already dependent on geological services work, Latimer said (late last year, Vox published a good overview of the history and opportunity presented by the technology).

“A large percentage of the world’s population actually lives next to good geothermal resources,” Latimer said. “[There are] 25 countries today that have geothermal installed and producing and another 25 where geothermal is going to grow.” 

Geothermal power production actually has a long history in the Western U.S. and in parts of Africa where naturally occurring geysers and steam jets pouring from the earth have been obvious indicators of good geothermal resources, Latimer said.

Fervo’s technology unlocks a new class of geothermal resource that is ready for large-scale deployment. Fervo’s geothermal systems use novel techniques, including horizontal drilling, distributed fiber optic sensing and advanced computational modelling, to deliver more repeatable and cost effective geothermal electricity,” Latimer wrote in an email. “Fervo’s technology combines with the latest advancements in Organic Rankine Cycle generation systems to deliver flexible, 24/7 carbon-free electricity.”

Initially developed with a grant from the TomKat Center at Stanford University and a fellowship funded by Activate.org at the Lawrence Berkeley National Lab’s Cyclotron Road division, Fervo has gone on to score funding from the DOE’s Geothermal Technology Office and ARPA-E to continue work with partners like Schlumberger, Rice University and the Berkeley Lab.

The combination of new and old technology is opening vast geographies to the company to potentially develop new projects.

Other companies are also looking to tap geothermal power to drive a renewable power-generation development business. Those are startups like Eavor, which has the backing of energy majors like bp Ventures, Chevron Technology Ventures, Temasek, BDC Capital, Eversource and Vickers Venture Partners; and other players including GreenFire Energy and Sage Geosystems.

Demand for geothermal projects is skyrocketing, opening up big markets for startups that can nail the cost issue for geothermal development. As Latimer noted, from 2016 to 2019 there was only one major geothermal contract, but in 2020 there were 10 new major power purchase agreements signed by the industry. 

For all of these projects, cost remains a factor. Contracts that are being signed for geothermal that are in the $65 to $75 per megawatt range, according to Latimer. By comparison, solar plants are now coming in somewhere between $35 and $55 per megawatt, as The Verge reported last year

But Latimer said the stability and predictability of geothermal power made the cost differential palatable for utilities and businesses that need the assurance of uninterruptible power supplies. As a current Houston resident, the issue is something that Latimer has an intimate experience with from this year’s winter freeze, which left him without power for five days.

Indeed, geothermal’s ability to provide always-on clean power makes it an incredibly attractive option. In a recent Department of Energy study, geothermal could meet as much as 16% of the U.S. electricity demand, and other estimates put geothermal’s contribution at nearly 20% of a fully decarbonized grid.

“We’ve long been believers in geothermal energy but have waited until we’ve seen the right technology and team to drive innovation in the sector,” said Ion Yadigaroglu of Capricorn Investment Group, in a statement. “Fervo’s technology capabilities and the partnerships they’ve created with leading research organizations make them the clear leader in the new wave of geothermal.”

Fervo Energy drilling site. Image Credits: Fervo Energy

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