History in the making: the first advanced nuclear fund gets launched.
In early 2018, Rod Adams posted an article on his very popular Atomic Insights blog effectively asking “where are all the advanced nuclear investors?” Valerie Gardner, a co-founder and principal at Tiemann Investment Advisors, read the article and reached out to Rod. We wrote about this back in 2018. This began the long conversation and eventual partnership that led to a long development process and ultimately the founding of Nucleation Capital, the world’s first venture fund focused on investing in advanced nuclear.
We are now very pleased to report that the Nucleation Capital venture fund has finally launched. It has been structured as an unconventional venture fund using the AngelList investment platform and their unique “Rolling Fund” structure. This structure provides for a quarterly subscription model that enables investors to fund their capital commitment using an installment plan for whatever number of quarters they wish. This level-loads the funding of the investors capital commitment over a period of time and makes cash planning easier for many investors. Now accredited investors can strategically and gradually sell their fossil fuel holdings and fund their investment in the technologies that will replace those dirty fuels on a quarter-by-quarter basis.
It also enables institutional investors to continue to fund their commitment to Nucleation over the standard funding period for venture capital, typically 18 to 24 months but it enables them to schedule regular fundings, say semi-annually, when otherwise, they would be subjected to unpredictable capital calls. This structure then enables investors larger or small to own a pro rata percentage of all of the investments made by Nucleation Capital for the subscribed quarters and democratizes access for smaller accredited investors, who otherwise might not be able to participate in these investments at all.
Nucleation Capital will be investing in those ventures that are working to dramatically “bend the curve” of the carbon emission paradigm. Its unique focus is on ventures in the under-valued and under-appreciated areas of advanced nuclear innovation, deep decarbonization and grid integration that nevertheless have the potential to punch way above their weight on carbon impacts. Most investors are focusing on what they can see, namely wind, solar, batteries and energy efficiency types of services, they have yet to recognize the exciting development coming from these nascent tech sectors. Nucleation Capital will be making investments starting as soon as Q2 of 2021.
We don’t believe there is “silver bullet” to solve climate. We believe that we need what some are calling the “silver buckshot” approach, taking a “whole of technology” approach. Even while plenty of investors will agree that this is our best option, nevertheless the vast majority of investors are putting blinders on with respect to atomic energy options and are not looking at advanced nuclear or carbon capture or removal innovation at all despite how powerful these technologies are expected to be and how critical they are to our fight against growing levels of carbon emissions. Sadly, there remains an over-abundance of investor interest focused on a narrow subset of technologies with marginal climate benefits and a dearth of investor interest in nuclear technologies that are scalable and dense, with substantial potential to impact the climate. In fact, have no idea what is coming from the evolving innovations in these areas and even fewer feel qualified to evaluate them. It takes a rare investor—individuals like Ray Rothrock and comes to mind—who has training in physics but also brings considerable investment expertise, to have been in a position to both recognize the value of nuclear energy and to evaluate the strength of ventures developing new technologies, to have made early investments in both fission and fusion ventures
We are very pleased to announce the launch of Nucleation Capital and its availability for those discerning accredited investors who are keen to invest in what some will consider a contrarian approach to clean energy—advanced nuclear. The fund is available online and provides fast and easy access to all fund documentation and terms for review or download by prospective investors. With a minimum quarterly subscription of just $25,000, Nucleation Capital has succeeded in being able to democratize access for investors so that those who are keen to participate can do so, whether they just barely qualify as an accredited investor or whether they have hundreds of millions to invest.
Nucleation Capital has now been established as an independent exempt reporting advisor (ERA). While it was incubated by Tiemann Investment Advisors (TIA), upon formation it was effectively “spun out” and is now an entirely separate entity. Because of TIA’s fiduciary obligations to its clients, TIA will not use its discretionary investment power to invest any client assets into Nucleation Capital. Nor will TIA recommend to any client that they invest in Nucleation Capital because that might seem like a conflict of interest. We are glad, however, that Nucleation Capital has been formed as a 506(c) fund, so we are able to inform our clients and the public about the fund. We are also happy to answer questions, should you have some. Any client or other investor who would like to learn more about Nucleation Capital, is welcome to download the Nucleation Capital Executive Summary or, better still, visit the Nucleation Capital website and/or the Nucleation Capital Rolling Fund Portal at AngelList.
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