Ep. 196 - The Climate Startup That Raised Billions and Made It Big: Fervo Energy’s Geothermal Breakthrough
SHOW NOTES
Often on this show, we feature founders who are still early in the journey: big idea, promising technology, maybe some early traction, and a hope that someday it all turns into something world-changing.
This episode is more about what it looks like when that actually happens.
Tim Latimer started Fervo Energy in 2017, while still in his twenties, after beginning his career as a drilling engineer in the oil and gas industry. Less than a decade later, Fervo has raised billions of dollars, gone public, and is now trying to transform one of the world’s biggest industries: energy. In fact, its widely celebrated 2026 IPO raised more than $2 billion, bringing a river of cash into the company’s coffers to build the next generation of geothermal infrastructure.
Today, Tim—now in his 30s—is the CEO and Chairman of a publicly traded company with a multibillion dollar market cap.
Fervo’s big insight is that the drilling technologies optimized in oil and gas—especially horizontal drilling—can be redirected toward geothermal power. In other words, tools once used to extract fossil fuels might now help produce clean, reliable, 24/7 carbon-free electricity from the heat beneath our feet.
Fervo has already put geothermal power on the grid through its partnership with Google, and now it’s building a major project in Utah that could help show whether geothermal can move from a niche energy source to a meaningful part of the clean-energy future.
There are hard questions, of course. Geothermal has been around for more than a century, so why has it stayed so small? Can it really scale? How different is this from oil and gas fracking? And can clean energy keep up with the enormous new demand from AI, data centers, and an electrified economy?
Tim has thought deeply about all of this, from growing up in a Texas town shaped by a coal plant, to working in oil and gas, to building one of the most successful climate-tech companies in America.
DISCUSSED IN THIS EPISODE
Wall Street Journal on Fervo’s IPO.
Fortune: The earth beneath your feet just minted a $10 billion company to power America’s AI boom
Tim decided to start the company while a student in Stanford Climate Ventures.
Fervo was a part of the Activate program.
Tim worked at the Lawrence Berkeley Lab.
Fervo’s breakthrough drilling tech.
Fervo’s post-IPO performance.
GET TO KNOW TIM LATIMER
Tim Latimer is the Co-Founder and CEO of Fervo Energy (Nasdaq: FRVO), a company pioneering the commercialization of next-generation geothermal power. By adapting proven technologies such as horizontal drilling and fiber optic sensing, Fervo is unlocking geothermal as a reliable source of 24/7 carbon-free energy.
Under Tim's leadership, Fervo completed the largest clean energy IPO in history in May 2026, raising $1.9 billion and achieving a market capitalization above $10 billion on its first day of trading. The company is building Cape Station, the world's largest enhanced geothermal project, delivering 100 MW of baseload clean power to the grid in 2027 and expanding to 500 MW by 2028 in Southwest Utah. Fervo has worked with Breakthrough Energy Catalyst, Google, Southern California Edison, Shell Energy, and other leaders in power generation, building a reputation for delivery and leadership in next-generation geothermal.
Tim began his career as a drilling engineer at BHP before earning an MBA and an MS in Environment and Resources at Stanford University. He has been named to MIT Technology Review's Innovators Under 35 and the TIME100 Next list for his leadership in advancing climate and energy innovation. Tim also holds a degree in Mechanical Engineering from the University of Tulsa.
TRANSCRIPT
Tim Latimer 00:00
Billions of dollars in an IPO, and for us, you know, the IPO is not a finish line; it's a starting line in a lot of ways.
Paul Shapiro 00:07
Welcome to the Business for Good podcast, where we spotlight people making money by solving some of the world's most pressing problems. I'm your host, Paul Shapiro, author of a nationally best-selling book on food sustainability, and CEO of a company in the same space. On this show, I speak with founders, investors, and thought leaders who prove that doing good and doing well can go hand in hand. The biggest challenges facing humanity are solvable and are often profitable too. My hope is that this podcast informs, inspires, and maybe even helps repel you to build a business that makes the world a better place. I'm glad you're here. Hello, friend, and welcome to episode number 196 of the Business for Good podcast. You may or may not remember, but a few years ago, we had on for episode 100 of the show the legendary venture capitalist Steve Jurvetson, and it was a great episode, very popular. But for the 200th episode, we are going to have another really special guest. So get ready for the 200th episode that's going to come out. But for now, 196. All right. First, here is your wild fact of the episode. Did you know that sharks are older than trees? I don't mean there are individual sharks older than individual trees. I mean there were sharks on Earth 400 million years ago. Trees didn't show up on Earth for millions of years later, so Earth had sharks before it had trees. I know, wild. Okay, if you listen to the show, you already know that we often feature founders who are still early on the journey, big idea, promising technology, maybe some early traction, and a hope that someday it all turns into something world changing. This episode, though, is more about what happens when it all goes right. Tim Latimer started Furvo Energy in 2017 while still in his 20s after beginning his career as a drilling engineer in the oil and gas industry of all places. Less than a decade later, Furvo has raised billions of dollars, gone public, and is now trying to transform one of the world's biggest industries, energy. In fact, its widely celebrated 2026 IPO raised more than $2 billion, bringing a river of cash into the company's coffers to build the next generation of geothermal infrastructure. Today, Tim, who now is in his 30s, is the CEO and chairman of a publicly traded company with a multi-billion-dollar market cap. Furvo's big insight is that the drilling technologies optimized in oil and gas, especially horizontal drilling, can be redirected toward geothermal power. In other words, tools once used to extract fossil fuels might now help produce clean, reliable, 24-seven carbon-free electricity from the heat that is beneath our feet. Furvo has already put geothermal power on the grid with Google as a customer, and now it's building a major project in Utah that could help show whether geothermal can move from a niche energy source to a meaningful part of the clean energy future. As always, here are your three key takeaways. First, geothermal is currently a tiny percentage of America's energy grid, far less than 1% Yet Furgo is the rare climate startup that's already made it big. Again, founded in 2017, they raised billions of dollars, went public, and now is a major clean energy infrastructure company. Second, Furgo's big idea is turning oil and gas drilling into that expertise into a climate solution by using horizontal drilling to unlock geothermal energy at scale. That basically means digging deeper, faster, and less expensively. And finally, the promise is clean power that works 24/7. Unlike just when the sun is shining, or unlike when the wind is blowing, geothermal is a potentially major role in the grid that is already strained by AI and data centers, and more electrification, and Furgo just might have the answer to solving those problems. Okay, I'll let Tim tell you that story. Tim, welcome to the Business for Good podcast.
Tim Latimer 03:50
Thanks, Paul. Great to be chatting with you today.
Paul Shapiro 03:52
Hey, you have been on such a wild ride. If there is an American dream, I think you've lived the entrepreneur's dream, right? And that is to start a company, raise massive amounts of capital, IPO, and raise even more massive amounts of capital, and go on to start trying to change the world. And you're one of the few who's actually done that, right? Most companies fail, let alone you know fail only after a couple years, and yet Fervo, which I was interested to learn, is Latin for boil, right? So I didn't even know, like you know, that's I was thinking fervent. I was thinking of other words like ferv, and so it was helpful for me to learn Latin for boil. We'll get to why that is relevant. But when you started this company in 2017, let me just ask you if you had thought, hey, I'm going to raise billions of dollars and be leading a team of hundreds of people and actually trying to transform the energy industry. What would Tim of 2017 have said to you?
Tim Latimer 04:49
It's a great question, and I'll try to put myself back in those in those shoes. And I think the the funny part of a journey like this is, like you said, a wild ride, and simultaneously a. Fantastic outcome, and and you know many things are are in terms of us achieving our mission and growing the company and raising capital are have just been like phenomenal experiences. But the irony is that it's also just the plan, and I and and so I think that's sort of maybe how I would have thought about it in 2017. I would have said, "Wow, it turned out it worked. That's that's quite remarkable because you know I think when every founder starts on that journey, you know that you would never entrepreneurship is hard. Starting a company is hard. It's it's a grind. It's emotionally taxing. It takes a lot out of you. You would never do it if you didn't have that north star in mind of a of a huge mission you can accomplish. But as you mentioned in the start, you know, most companies don't get there, and so and so I think that's the the funny dichotomy of of that position is is it would have been both things true at the same time. It was just the plan that we put down on paper and we executed it, but simultaneously, just remarkable to see that it all it all came together the way that it did. So I think that's how I would have thought about it in 2017.
Paul Shapiro 06:02
And if you had been told in 2017, nine years later, the plan will have worked. Will you think is that because I was so smart, or because I got lucky, or because the timing was right, or the technology was really good, or the people around me were great? Like, what what was it that made the plan go right?
Speaker 1 06:18
I think that all those things are true. You know, timing matters. the The external environment matters. You know, when you think about entrepreneurship, one of one of my mentors always refers to this is is that you have kind of an earned secret that that you have that nobody else has, and that's what makes your company successful. Because if it wasn't a secret, then you know the incumbents would be doing it. There wouldn't be a space for you. And and a secret, by the way, doesn't mean that people haven't had the ideas before. You know, there's all kinds of companies that have pursued ideas that didn't work, and then companies come along later and pursue very similar ideas that do work. And it's because the timing is right. I think that earned secret could be in part because you you have an idea and and you realize that its time has come, and I think when we started Furvo, we had what I would say two earned secrets that really steered the strategy of the company. And one of them is a little bit ironic, given the world we're in now with unprecedented levels of electricity demand. But I was always a believer. My co-founder was already Jack Norbeck was always a believer, and our early founders were always a believer that the world would need more reliable, clean electricity. And actually, that was one of the barriers that led power generation companies, whether it was across the nuclear space or renewable space or conventional fossil fuel space, 10 years ago. There was not a lot of capital formation around that because the U.S. had stagnated in electricity growth for almost two decades at that point in time, and and I think we believe something that was counterintuitive at the time is that you know of the arc of human history, we always need more energy, and we need that energy to be more reliable, cleaner, and more cost effective. And that was one thing that we made a bet on that was maybe a little bit counterintuitive. That that obviously the timing and the macro environment proved us very correct about, and and that was one thing we got right. And the second thing we got right was something that was really foundational to my experience as a drilling engineer in the oil and gas industry when we started the company before I started the company, which is that you know I had seen firsthand what we call the shale revolution. You know, the U.S. used to be in a two or three decade long decline in oil production, and and and a lot of when I started my career in oil and gas over 1515 years ago, the conventional wisdom was that that was just going to keep petering out. And then what I observed when I started my career as a drilling engineer in oil and gas is that the technology had just dramatically transformed in terms of our ability to image and collect data about the subsurface, in terms of our ability to drill cheaply and cost effectively and fast. And that was such a new development 15 years ago that that idea hadn't really percolated out in other industries. And the other earned secret we had is I talked to folks who were geothermal incumbents, and I realized that they were not in the meetings or at the companies or going to the conferences where these dramatic technology leaps that the oil and gas industry had achieved were being shared. And and you know my first conversations because one of Furbo's foundational ideas is that horizontal drilling was going to be something that unlocked huge amounts of new energy from the geothermal space cost effectively. The first time I talked to folks in the geothermal space, I was told that it's impossible to drill horizontal wells of geothermal, and that was just conventional wisdom in the sector. And so I think the second earned secret we had was that drilling technology had transformed so dramatically in the in the in the preceding decade that all of the assumptions around cost structure of geothermal were out of date, and and I think that you know we got very fortunate on the timing. We had phenomenal partners that came in that helped us out in tough spots over the years.
Tim Latimer 09:49
But I think the reason that we turned out to be fine success is that we we started the company with two core beliefs that both turned out to be true. The first is that the world needed. More reliable, clean, affordable electricity, and the second was that drilling technology was going to be a huge unlock for the geothermal cost structure, and those two truths have led us to where we are today. Even though there was a lot of little things that we got very wrong along the way.
Paul Shapiro 10:17
So let me ask you about this, Tim. You were in the oil and gas industry, as you mentioned. A lot of the times, people who found clean energy companies, these are mission-related warriors, right? They're climate warriors. They have some passion for the for the planet. And I'm not suggesting that you didn't care about the environment, but you were working in the fossil fuel industry. You probably thought, as you were becoming an engineer in your young career, that you were going to work in that industry forever, maybe, and then you look at something like geothermal, which represents virtually none of the energy that we use today in the United States. Like solar and wind have become very substantial parts of the electricity that we utilized, whereas geothermal is still struggling way less than 1% of the total amount of electricity that we use, and you thought, "Huh, the world needs more clean electricity, and there's new technology. Was this just a business opportunity? Did you have some passion personally for environmental protection? Like, what what was it that led you to think, "Okay, I'm going to be the guy who's actually going to take geothermal from less than 1% to make it a meaningful part, and why why do you want to do it?
Tim Latimer 11:19
It's a great question, and and for me it is about the mission and and maybe to think about you know one of the things that shaped how I view the world is I became very passionate about energy pretty early on you know growing up in Texas it's part of life so that was a part of it but then you know when I was in junior high actually a company came in and proposed that they were going to build a large coal-fired power plant in my hometown. I grew up in a town called Resol, Texas, which is in the central part of the state. It's about 1000 people, and I got to sort of witness that buildout in my hometown from a from a early age, and and I think that was fortunate for me because for a lot of folks, unfortunately, energy's out of sight, out of mind. Even though it has all kinds of impacts for them, you know, a lot of people's only interaction with energy is if they flip a light switch, the light comes on. They don't really think about it, you know. And you only really think about energy if you flip that light switch and the light doesn't come on. And and that's not something that's possible if they build a coal plant in your hometown. And I think the lesson I took away from that actually was that I observed how it was in my hometown. You know, you can you can now hear the turbines from my from my childhood home for that gas turbine and and clearly or sort of for that coal turbine, and and clearly coal has all sorts of local environmental negative impacts. But at the same time, it brought so much economic development to our town that it allowed you know our town to build a new high school and and created jobs in the area that were desperately needed and and I took from that from the very beginning that energy is absolutely vital to people's lives but and so we have to have it it's non-negotiable we have to have energy but if we could just have energy, but with lesser and lesser environmental impacts, then every everybody would win. And and energy was a clear part of my world. And so you know, when I was graduating after growing up in Texas, and the shale boom was taking off, it seemed like a very exciting sector to go into. And it really you know underpinned that that the kind of the first part of that thesis, which is that increased energy development can can be an economic driver that improves people's lives, and I was very excited about that. But there was also part of me that that always felt this nagging doubt about the second part of the equation, which is, but is the thing I'm working on day in day out also going to reduce the environmental impacts of the work? And and I've always been a big believer in innovation, and I don't like when things get put in a box where you're forced to choose between two suboptimal outcomes, and I've always believed that if you're forced to choose between two suboptimal outcomes, that that is an opportunity for innovation to make that trade-off less costly, and and so it was with that context that I sort of stumbled into the world of geothermal, and I realized that the technologies that I was working on day to day in oil and gas could do the same thing in geothermal. That would open up energy supply. That would create economic opportunities. That would make energy more reliable and more affordable for people. But if that worked, it was going to do so in a way that was far cleaner than the way we get energy today. And and I honestly, in some ways, I thought it was cheating. I was like, "Wow! I've spent years becoming a drilling engineer, and there's actually a discipline where I can go work at that and create energy for people and do so in a sustainable way.
Tim Latimer 14:28
And and it was just you know that's kind of what motivated me from the beginning is finding this thing that that wasn't a trade off between two suboptimal choices. It was something that achieves both parts of what I think are really key missions for the world, increasing access to energy and doing it in a cleaner way, all in one thing that mapped to a skill set I already had, which was drilling wells, and and that's what drew me to the opportunity.
Paul Shapiro 14:53
Okay, why Tim is geothermal such a rounding error in the energy set? Today, presumably, a lot of people know that it's hot underneath the earth. The deeper you go, the hotter it gets, and heat can help generate electricity. But yet, we still are spending our time either digging up fossil fuels like coal and oil, or building solar farms, or wind farms, or nuclear power plants. Why is there not as much interest in energy going into geothermal? Like, why is this still a rounding error in the energy pie?
Tim Latimer 15:32
It's a great question, and geothermal is not new. It's been around for over 100 years. The first geothermal power plant was developed in Italy in 1904, and yet it has not grown, and and the reason for that, like a lot of things in the energy and infrastructure world, comes down to cost, and and geothermal is a resource that you find underground, and so it shares characteristics of other things that you find underground, which is that some of the resources are better than others, and and so you know, if there is really high heat very close to the surface and permeable reservoirs, because it's you know on top of a volcano or near a rift zone like you find in East Africa or Iceland, it was cost effective, and and you could drill relatively shallow wells, produce the steam from them directly, and generate electricity from it. And that's why the industry has been around for 100 years because in certain places with very unique geology, it worked. In those places are Kenya and Iceland and New Zealand and California. But the challenge was that once you develop those resources that you know were so geologically perfect that you know in many cases they were truly sitting on top of volcanoes. When you try to move to the next set of resources that may not have had the same geologic attributes. The drilling costs escalated so much that it was cost prohibitive. The well productivity, if there weren't wasn't enough natural flow pathways in the subsurface, wouldn't produce enough megawatts per well, and so the industry sort of has has stagnated now because the really good early resources and places that had the perfect geology were tapped often decades ago, and the technology didn't exist to make the next class of resources work. And so that's how it ended up being a rounding error. And you know what Fervo has done differently is is this recognition that the drilling cost curve has been bent so dramatically that okay, what if that next class of resources, where you have to drill deeper because you're not on top of a volcano, and you have to figure out how to make the wells more productive, and you have to do it at a lower cost structure? What if the technology exists to do that? Could you take this from a resource that you know today in the United States produces only four has a capacity of only four gigawatts, which is, as you mentioned, effectively a rounding error in terms of the national energy mix, and could you turn it into something that's 10s or hundreds of gigawatts because you have the cost structure to drill deeper and drill more productive wells, and and and that was the real limiter before Furvo, and that is what the technology that we have brought to the sector addresses: is this ability to go to a broader class of resources with a lot more geographic reach, and still make those projects be cost effective.
Paul Shapiro 18:08
So, in an earlier episode of this podcast, Tim, we had on Quays Energy, which is also a geothermal company doing really deep drilling. They claim you know their their goals are to drill the the deepest holes that have ever been drilled, right? So it seems like their technology was really about like using drill bits that didn't mind all the heat and wouldn't melt when you got down there. You're talking about horizontal drilling, though. So what's the difference between you and Quays? Like you're each saying, "Hey, we're going to make it possible to get to deeper parts of the Earth so that you can get to hotter places less less expensively, and therefore bring that heat up to the surface by putting water down there, bringing that water up, and that helps create power at a power plant. What's the difference, though? Like, why why are they doing something different from you?
Tim Latimer 18:50
Yeah. So, maybe talk a little bit more about the the process here. Is you know the reason you drill deep is that the close, the deeper you go, the hotter it gets, and in some places that heat's close to the surface, in some places it's it's deeper, and that that gets back to that cost curve element I was telling you before, which is the places that are super close to the surface have probably already been developed. There's not many of them, and so you have to figure out technology to get it deeper. And and actually, the insight I had when I was first looking at geothermal a while ago is is that I found reports, and it was like the MIT Future of Geothermal Energy report that was published in 2006 that actually laid out a great roadmap for how enhanced geothermal systems could disrupt the country in a good way. Obviously, like by providing more more reliable clean electricity, and and they they noted in that report, you know, essentially that you know it would always be cost prohibitive unless we improve drilling rates by like an order of magnitude, and and they sort of put it out there as if this as if it was this crazy moonshot that would rely on all sorts of advanced technology to to get done, and when I read it though, I had a different reaction, which is that my experience in oil and gas is that we'd improve drilling rates by an order of magnitude in the prior decade. So I was like, "Wait a minute! They published this paper in 2006 saying that we need this moonshot to drill 10 times faster. And then I'm reading this report from an oil and gas drilling rig seven years later, and in the intervening time, we've gotten 10 times faster at drilling. And that was the light bulb that went off for me. It's like, "Wow! If you could drill this much faster, this report from MIT says that this could be this ubiquitous resource that's that's anywhere, and and what I realized is that we needed to structurally apply those technologies from the oil and gas industry to geothermal that unlocked that that 10x productivity and drilling. And to kind of tell you where this where this went, we identified our first pilot project site in Nevada. We did this through a partnership with Google because they have this great 24/7 carbon free energy initiative where they stepped in even in 2021 when we were an early company to be our partner on this, and we scoped out we're going to drill a couple horizontal wells and show that we could produce more geothermal energy from those horizontal wells, and we're going to borrow this advanced drill bit technology and motor technology from the oil and gas industry to make it happen. And I will tell you the original reaction we had as we proposed that from a lot of the incumbents was that oil and gas stuff will never work here. Our wells are in granite, which is a much harder rock than the oil and gas industry drills through. Our wells are way hotter; it'll never work. And that was the skepticism we faced. But we came into an area where traditional geothermal drilling typically only went maybe three to 5000 feet, and we realized that you could get more heat if you went deeper, and you could get more heat if you went horizontal. And so we went to that site, and and those wells that were three to 5000 feet deep, they would take like 50 days to drill. And we said, what if we went 8000 feet deep, turned horizontal, and drilled 3000 feet more? Again, most of the incumbents experts we talked to said couldn't even be done, but that was our project, Red Pilot. We ended up drilling that first well, first horizontal well ever drilled in the world for geothermal, because we had to develop a lot of new drilling technology to make it happen. And we did it in 70 days, which I thought was quite an accomplishment, because this well was double the length of these other wells that would take 50 days, and we only did it in 70 days, even though it was harder, hotter, harder, included this horizontal component. But that was just the beginning for us.
Tim Latimer 22:01
One thing that we just announced in a press release actually is in the intervening four years we've gotten radically better. So I just want to tell you about what we just did. We just drilled a well to 19,448 feet at our site in Project Cape. It's dramatically hotter than the Project Red Pilot we we drilled. We drilled it over 100 degrees Fahrenheit hotter. And keep in mind that project Red Pilot. They said could not be drilled because it was too hot, and we drilled it in 21 days, and and so we're drilling radically faster now, and and that's the huge unlock that allows geothermal to go to way more places.
Paul Shapiro 22:34
Yeah, that's amazing. That's amazing. And so for people for people who are uninitiated, Tim, when you talk about these wells, it's almost 20,000 feet. What does this well look like? How wide is it? Like, if you're walking on the surface surface of the earth, are you going to fall into this thing?
Tim Latimer 22:46
No, this is a common misconception. Actually, I don't know. I was going to say this is maybe not the most fun dinner party activity, but maybe y'all can all do it. All the listeners can do this as a dinner party activity. I realized there was a huge disconnect in this. One day, I was at a dinner a few years ago. People started asking me what I did, and I told them this, and they asked this question, and they said, "How wide is the wells? And I was like, "How wide do you think the wells are? And and and the base answer I got was 100 feet wide, and I and I kind of chuckled at it because the correct answer is actually the wells we drill end up being by the time we get down to that 20,000 feet somewhere around eight inches wide.
Paul Shapiro 23:22
What about at the surface, or you're saying 20,000?
Tim Latimer 23:25
At the surface, so the well, the well design, and be careful. You're asking a drilling engineer this, so you may get much longer answers than than you want. But the well's kind of telescope in, so you put in large pieces of steel casing, and then you put in smaller pieces of steel casing inside that. So at the surface, they may be maybe you know 16 inches wide or 20 inches wide, but at this depth it's about eight inches wide, and so it's a relatively small well. But it goes down in our case now 12 or 13,000 feet until the temperature gets to 450 degrees Fahrenheit, and then we turn in the drill bit and drill it horizontally for 7500 feet, so a mile and a half. So just think about you know if you were to go out and run on a track, we're basically that we're drilling horizontally in solid granite at 450 degrees Fahrenheit, the equivalent of like six laps around a track. I mean, it's a pretty long thing. We're doing a company retreat in a couple weeks. We're joking. We should have a instead of doing a 5K, we should do a race with our well length because it's like it's a good way to visualize it, but that's what the wells look like. And the the key is drilling horizontally because traditional vertical well for geothermal, the only part that touches that really hot reservoir is sort of the eight inch diameter well that's down there at the subsurface. But in our case, we get way more access to heat because we turn that well sideways and we drill it for a mile and a half, and that means that every well we drill is way more productive because we have so much more access to heat, and that's the key of what the horizontal drilling does for.
Paul Shapiro 24:49
So, first of all, I presume people who don't want to run a long time are going to love to run only six laps on a track rather than 5k. So that'll be better for them. So you might get higher participation if you do that. But second. So just for again for the uninitiated, so you have basically an eight to 16 inch hole in the ground, and what you're putting down there is essentially a pipe of water, right? Like you're putting you're you're shooting water down there, letting it get heat up in that 450. It's a real oven, almost literally down there, and that water comes back up, and and it's essentially boiling, right? Because the boiling point of water is 212, so it's boiling water, and that then goes into a power generation plant, which produces the electricity. All right, so that you know is is all very impressive. Before I get into the IPO and how how things have gone post IPO, what do you think about this claim that some people who are concerned make? Right, so you have one. They're going to say, "Hey, this is just fracking with a different name, and we don't like fracking. And they're going to say, "Hey, listen, as technological improvements increase the efficiency of this, people are going to consume even more energy. Right? It's like Javon's paradox. Like you know, it becomes cheaper. People use more of it. So, first, what do you say to the critics who say, "Hey, this guy is just fracking for so-called clean energy, and then what do you say to the critics who say, "Listen, do we really want to make energy cheaper because we're going to use a lot more energy?
Tim Latimer 26:13
Yeah, both great questions. And you know, Furvo is a very transparent company, and and I think that's something that served us really well in our community engagement work and community outreach work, and so the answer to the first question is: is we don't we don't try to deny it or hide it. We use technology that is borrowed and adapted from the oil and gas industry that that uses hydraulic fracturing techniques, and the reason we do that is because that water, that cold water that goes down needs to have a lot of surface area where it connect can connect to the formation, so that it can return hot, and it needs to have a flow pathway for the water to get from the cold injection well to the hot production well. And and traditionally, geothermal tries to find those natural factors in the subsurface, and that's what's led it to be a very hit or miss endeavor. That's a big rounding error. What we do is we create those fractures from the well so that they connect to the injection and production well, and so we never try to hide that fact. We're very transparent about the fact that we're we're borrowing that technology. But that being said, there's structural differences in how we apply that technology in our systems compared to the oil and gas industry that that I do think leads to much more environmentally benign outcomes, and usually when I talk to folks about this, the questions are: you know, what are the downsides of fracking that you're worried about, and and and then I can explain through education how our processes are different. And and you look what most people talk about is it creates a produced water problem where there's contaminated water that needs to be reinjected. It creates methane emissions. There's flaring associated with it, and so a lot of those complaints that people have just simply do not apply to geothermal projects because we're not producing oil and gas, and and so we're able to recirculate the geothermal brine continuously in the process. We don't have to deal with water disposal. There's no methane in the process, and we don't have to deal with flaring. There's no hydrocarbons in the process. We don't have to deal with the contamination there because our formations are different. We don't have to use many of the same chemicals that the oil and gas industry uses. So we like to be quite transparent about this and just say, you know, especially when we talk to local communities where we operate, what are your concerns, and let us explain how we do this differently and and how we do this as a responsible operator. So I think we feel very good about about our position there.
Paul Shapiro 28:22
Great. So, before we get on to Javon's paradox, I I just want to state you know that that definitely sounds categorically different to me than fracking for for fossil fuels. But I will say also, you know, the shale boom did unlock a lower carbon energy source than what we would have been using otherwise, right? And so, even for folks who who are concerned about fracking, I would argue, you know, is it is it better than what we would have done otherwise? Probably so, right? Like using all that all that fossil gas has a lower carbon than if we were using other fossil fuels, so it's better to go to carbon free, of course, like what you are doing. But I do think that fracking may have gotten a worse reputation than it deserved. Not that there weren't problems or aren't problems with it, but worse compared to what we would have been doing otherwise, for sure.
Tim Latimer 29:18
I think that's a good point, and I would say your view on that, and there's been I would have to say 1000s of papers written on this specific topic now, and the view has to get nuanced about what you believe about you know replacement energy and what the methane leak rate is, and you know if you're using 20 year warming or 100 year warming. So it's a it's a it's an interesting debate. I would say the nice thing for us is there's there's no debate. You know, our energy is carbon free, so it's so it's it's it's categorically different. Yeah,
Paul Shapiro 29:46
yeah, yeah. You're absolutely right. I agree. It is a difference in kind, not a difference in degree. So then the question becomes: Does it matter if people are using more energy if the energy is clean, right? So if you're using like the problem with energy. Use generally speaking is carbon emissions, right? If it's a clean source of energy, does it matter? And if you're just using geothermal energy, doesn't matter that you're using more?
Tim Latimer 30:10
You know, and I think this comes back to to what what I would consider to be the the dual mandate or dual mission of of what what we of what we do, right? And and I am a firm believer that more energy for the world is is inherently a good thing, and and you know there are billions of people around the world that either do not have access to energy or do not have access to reliable energy, and that is a massive change in quality of life. And I think we need to to continue building out energy infrastructure until until you know that is that quality of life can be extended to all people, and then even people who have energy. A lot of times, if you live in a country where where there's universal energy access or near it, a lot of times the affordability is still a challenge. And so I think we need more energy for for people, and and I believe that's that's kind of a fundamental truth. And then I think if you take a step beyond that, it gets to this point that I made in the beginning, which is I hate when there's a choice between two suboptimal outcomes. And if we had to have more energy and we only had the available energy sources we have today, that would be a suboptimal outcome because the carbon emissions and the resulting impacts of that are would be significant. And so I think that through innovation and through development of resources like geothermal, you know, and other renewable energy, and nuclear, and and some of these other things, but but obviously what we work on is geothermal. The best outcome for the world, I believe, is providing the right affordable access to energy for all people, but doing it in a way with ever decreasing environmental impacts, and I believe that's what geothermal does.
Paul Shapiro 31:39
Yeah, and in a way, a lot of the energy transitions that have occurred in the past have also followed the same path of lowering the problem environmentally. Right, even coal was a replacement for deforestation. So, you know, it's probably a lot of animals who didn't go extinct because of coal mining originally. Now, of course, coal is, to use your word, quite suboptimal, and would be better replaced by geothermal, but we have continually tried to get lower and lower footprint in what we're doing for energy. And Tim, I agree with you that you know, look, if you have very little energy and you go to having some energy, that is a major boost in your quality of life. I am not so sure that for those of us who have what you refer to as universal access to energy. Like how much, how much more it makes our life better. Like if I have the ability to have ChatGPT give me a video of a raccoon giving me cooking instructions for how to make a dish that I want to make. Like you know, those are like the types of things that realistically the energy that we're the ex the the new energy we're going to produce is probably going to be going to you know data centers and AI and so on, which is cloud computing, which I love. I mean, I'm an avid user of it, but it does seem different than bringing energy to people who you know are using kerosene stoves right now, for example. Okay, so I want to get Tim to your IPO and to your your process here because you went on this rocket ship ride, right? You start this company in 2017. You're still in your 20s at that point, and all of a sudden, you're raising literally billions of dollars from investors. You you raise like one and a half billion dollars and decide, hey, I want to do an IPO, and we're going to raise a couple more billion dollars. What was the catalyst for you to think we need to go public? Right, a lot of companies these days remain private for a decade or more before they ever have some liquidity event for their investors. You did it after only a few years, so why? What what was the trigger for you that thought let's put this on the market, on the public market? That is,
Tim Latimer 33:46
yeah, I'd say a couple things. One is advice that that I was given to, that I that was given to me early on, and that I always extend to other entrepreneurs, particularly if you're working in capital intensive businesses that take a long time to develop, like geothermal power generation, which is that investors invest on a line, not a point. This is one of the things that that was sort of drilled into me early, and advice I would give to every founder out there.
Paul Shapiro 34:11
I like your use of drilled into you. It's a very good one for for your career.
Tim Latimer 34:14
If you're going to talk geothermal, you cannot avoid the puns, so you just got to get used to it. But I but I appreciate that. So the the thing that we that that was drilled into me there is that what investors like to see is progress, you know. And I can't tell you how many investors we had over the years where I pitched them in one round, and they they told me this is a crazy idea, and then I came back and pitched them in the next round, and they said, "Wow, we thought your pitch last time was crazy. You've actually done everything that you said you were going to do in that pitch, and so this is now a company we want to back. And I think every round that we've had has been part of that journey. So even before the IPO, we'd raised a billion dollars, and very often, and I actually almost universally, the folks that led and participated in our current round were people who'd passed in the prior round. But a core value of Fervo is always. Do what we say we're going to do, and I believe over the years we've developed a reputation as a company that delivers against our promises, and and that has allowed us to raise a significant amount of capital, and and that carried us up to the date where we were today, and that was things like delivery of our project Red Pilot in Nevada. This is things like executing new power purchase agreements, breaking ground, hitting new technical milestones at our project Cape Site in Utah, and so when we got to the point of the IPO, what we realized, and we closed the series again December of 2025, so so not that long ago. But what we started to realize is that the broad theme of people realizing that there there is going to be a shortfall in electricity in America if we don't address the problem quickly, and that electricity load growth is back, had sort of permeated the public markets, and they were looking for solutions. And because our country has not built and expanded the electric grid in a long time, there are not a lot of ready off-the-shelf solutions. And so we started talking to investors, and we realized what they were hearing from us was a new technology that was carbon free, that was reliable, that could be built quickly, that already had a proof pilot project on the grid producing energy, and it was a pretty unique story that they that they weren't hearing a lot because what they were hearing from everybody else is, you know, we can't get natural gas turbines because it's a six year out lead time, and and you know there's there's a shortage of of round the clock capacity on the grid, and so wind and solar are going to play an important role in expanding electricity generation. But we need a complement that could work 24/7, and this is something that's working today. And we realized that the enthusiasm from like kind of public and market investors because they they were hearing our solution and realizing that it was unique was was pretty immense, and and we decided that the next step for us was to go public. And I will tell you a guiding principle we've had it for a long time. We're a mission-driven company. I believe you can only impact things like energy affordability and carbon emissions if you actually are putting megawatts on the grid. And so one of the one of the core tenets we've had for a long time is if you're at a strategic fork in the road, the thing that unlocks your ability to put more megawatts on the grid is going to maximize your impact, and it's likely the correct decision. And what we saw was the ability to raise billions of dollars in an IPO. And and for us, you know, the IPO is not a finish line; it's a starting line in a lot of ways. But for what us, what that ended up resulting in is we had $2.2 billion of capital that we could deploy into accelerating the projects that we were that were underway faster, and that was the reason we made the decision to pursue the IPO.
Paul Shapiro 37:28
If someone invested in your company in the 2017 2018 Fervo era, how much did they make in the IPO?
Tim Latimer 37:36
I think those investors in that time period did did pretty well. I don't know if I have all their numbers in front of me, but they did they did pretty well. Yeah.
Paul Shapiro 37:45
Yeah. Okay. So since the IPO, you guys continue to do impressive things, like you mentioned. The stock price has not done as well as one would hope, and your your q1 numbers show some pretty big losses and major capex, which of course makes sense for infrastructure build out, but it creates pressure. So, what are the milestones that people should be watching for now to see whether Furvo is still executing and doing what it says that it's going to do?
Tim Latimer 38:16
Yeah, I should say. I mean, as you can probably tell, we we're a company who thinks very long term about our vision, and we're we're very committed to always delivering on our commitments. Always do what we say we're going to do as a core tenant, and and I think that's something we're going to bring to the public markets as well. And so and so, I think folks who know Furvo understand that, and and that's part of the story. And I think we're really excited about our outcome in the in the public markets, and and also our continued opportunities here, you know, for us the next steps are are are we are really excited about the progress we've made at our project Cape Site in Southwest Utah, and so hitting key project milestones like delivery of first electrons from that project later this year, and then our expansion of bringing that project all the way up to 500 megawatts by 2028 is sort of a key thing that that folks paying attention to Furvo should should look out for in terms of tangible milestones that we'll be achieving in the coming coming years that will continue to create value for Furvo and maximize our impact. And then we're also seeing, you know, as I mentioned, unprecedented demand for electricity. So I think we're quite excited about where we are as a company, where we've already executed over 650 megawatts of binding power purchase agreements with our utility and corporate customers. I think that in the coming months and years, you're going to see significantly more offtake agreements from us that will be a precursor to that larger growth. And I think that's another tangible milestone to look for for us. And I think we're pretty excited about that. And I would say that you know things like you know reporting losses and otherwise are all very much expected given the phase of business we're in. We're building incredibly valuable assets, but they also require a lot of capital. So we're going to be investing a lot of capital in the coming years. To be able to grow this portfolio, and and I say none of that was unanticipated.
Paul Shapiro 40:04
Tim, you've done a lot in the past decade, right? So you went from being an engineering student to being a low level oil and gas engineer to starting your own company, going to Stanford, getting an MBA, becoming an entrepreneur, and now running a business with a multi-billion-dollar market cap and being traded on the public markets. Surely there must have been resources that were helpful for you during this journey. If somebody's looking at your story and be like, "Man, this Tim Latimer dude, I really respect and admire what he has done. I want to do something like him. What should they check out. Are there any resources, whether books or otherwise, that have been useful for you?
Tim Latimer 40:44
Huge amounts of resources, and I feel like this is almost like you're gonna have to like play play music to get me off the stage after an award speech because it's there's just too many people to thank for the journey along the way. But you know, just a few of the things that made a really big difference for us early on is one, which was unique to Stanford, but but you know we took a course called Stanford Climate Ventures that was really transformative for us getting set up to build the right business model to think some through some of these things. If you're building a capital intensive business that's going to take a long time to generate first revenue, how do you convince investors it's worth doing? So that was a great resource for us. I'm also a huge champion of the Activate program, which is a nonprofit that that is set up with a mission to advance science-based entrepreneurship. And Activate both has a great cohort-based model. We were part of their Berkeley chapter, so we got to work at the Lawrence Berkeley National Lab, and they've now expanded. One thing I'm delighted about: they've expanded Houston, and so there are resources, especially for science-based entrepreneurs who are looking to have a positive impact on the world, where you can do programs like that, and so that that that piece is is really is really pivotal. And then and so I think that's the thing. There's always things you can read and always things you can learn, but you know there's no substitute for for putting yourself out there, applying for these programs, seeking out resources like that, and I think that's the thing that's helped Furvo the most. Is in the early days, those those programs like Stanford Climate Ventures, like the Tomcat program for sustainability at Stanford, like the Activate Program, which is now nationwide, that have a lot of resources out there for science-based entrepreneurship. Those are the things that made a big difference in Furvo's journey.
Paul Shapiro 42:23
Okay, really helpful. We'll include link. We'll include links to all those at the show notes for this episode@businessforgoodpodcast.com. And finally, Tim, what should other people do? Obviously, you are an entrepreneur at heart, and you are stuck doing Furva for some time. It appears. So I imagine, though, that there are other ideas that you have. Obviously, Fervo isn't going to answer all the world's problems. So, what else should somebody be thinking about starting if they want to go on a similar journey?
Tim Latimer 42:50
Yeah, I think that there's a a growing. This is going to be a very self serving answer. So, I apologize for that in advance. There's an exciting and growing geothermal entrepreneurship ecosystem. I think it needs to be 10 times bigger and 10 times faster. And there's all kinds of opportunities. And that doesn't mean you know Furbo has has has gone through the decade long journey of establishing ourselves as a developer of power. We we built the power plants, we sell the electricity, but we have pain points all across the value chain of we need drill bits and motors that that work at higher temperatures. We need power plants that are faster to construct. We need electrical equipment that's more efficient for installation at our project sites. And I believe that there's going to be a new wave of a geothermal startup ecosystem where it's not necessarily folks that are trying to compete with Furvo as a developer, but it's folks that realize that if this industry is growing rapidly, there's all kinds of new business opportunities in solving the technical and engineering challenges that go into the geothermal power plant process. So, faster construct power plant facilities, more efficient electrical equipment, higher temperature drilling tools-these are all things that I think we're going to see a flourishing of of startups in the coming years as geothermal has now established ourselves as a real large and growing industry.
Paul Shapiro 44:11
All right. Well, I hope that somebody creates the next big drill bit that Fervo will be using to go deeper and faster than you've ever imagined before, so I really appreciate what you're doing to try to avert and mitigate the worst effects of climate change here by helping transition us off of fossil fuels, Tim. And I will be rooting for your success as the company continues on its journey. Fantastic! Thank you. Thanks for listening to the Business for Good podcast. To explore more conversations like this one, visit businessforgoodpodcast.com, and be sure to subscribe so you don't miss future episodes with founders, investors, thought leaders, and more turning global problems into powerful opportunities. And if this episode resonated with you, please share it with your network. You never know who you might inspire to be in the business of doing good.