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Bill Gates, the world's fourth richest man, has no need to profit from climate change investments. Gates, on the other hand, sees lots of opportunity for individuals trying to hit it rich.
Gates predicted future returns in climate investing would be equivalent to what the biggest IT companies have achieved in an interview that aired Wednesday as part of the virtual SOSV Climate Tech Summit.
"There will be eight, ten Teslas," Gates said. "And today, just one of them is well-known."
Elon Musk's electric vehicle firm has more than doubled in value in the last year and is up more than 2,000% in the last five years.
"Anyone who invested in Tesla feels extremely clever," Gates remarked of the winners.
He believes the benefits will be extended throughout a broader range of enterprises, not only those in the electric car industry.
"You know, Microsoft, Google, Amazon-type enterprises will emerge from this sector," Gates said.
Microsoft was co-established by Bill Gates in 1975, while Amazon and Google were created in the 1990s, as the internet was gaining traction. They're now three of the top four most valuable firms in the United States. According to Forbes, Gates is currently worth $134.3 billion.
SOSV is a venture capital firm established in Princeton, New Jersey, that invests in early-stage climate-tech start-ups.
Breakthrough Energy Ventures, which Gates co-founded with Amazon founder Jeff Bezos, Michael Bloomberg, and Ray Dalio, invests in clean tech.
While Gates is optimistic about the industry, he believes that a significant amount of money will be lost, similar to what happened when the internet bubble burst, and that today is "like the early days of software and computing."
Much of the technology is "at the lab level," according to Gates, and investors will need to be cautious when evaluating the idea's economic potential.
Furthermore, many of the ideas will require a significant amount of funding before they can be demonstrated to be successful.
Nuclear fusion, nuclear fission, and energy storage, for example, take "hundreds of millions, if not billions" of money to try out, he added. "You don't know whether or not" those technologies "will be able to help," he added.
Climate technology requires governments to develop "encouraging policies" that encourage the adoption of zero-emissions solutions, in addition to large capital contributions, he added.
Investors looking for a low-risk way to invest in space might "participate in funding solar fields," he added.
Direct air carbon capture, hydrogen, steel, and aviation fuel are the more challenging markets to forecast.
"We're going to have a lot of failures," Gates said. But there are enough ideas that "we have a good chance of big success," he added, especially with the correct government support.
"I would go elsewhere for someone who can't afford risk or who expects near-term rewards," Gates said.