Baker's rare-earth bet targets chemical refining

Transcript

Transcribed by machine (Whisper) from the episode’s audio, so a word may be off here and there.

1. 1:52:30

   stands. Yeah, it's great. Jordi mentioned getting sharp on bio, starting to think about opportunities there. How deep have you gone in the AI stack? I saw a funny post that was like, you could spend all your time thinking about OpenAI and Anthropic and Google, or, and then, you know, meet all the NeoClouds and meet Lynn and Tuin and figure out what's going on in the private markets, or you could just buy copper and you could just sit there and hold copper, right? Because like, it's almost a perfect proxy or something like that. But how far have you gone down into energy infrastructure, commodities? How sharp are you on those? How relevant or interesting are those markets to you in this world since they do seem adjacent? No, I pay close attention to all of those.

2. 1:53:14

   I ran a diversified fund in prior life for nine years. I was an energy investor, natural resources. For many years, I would do marketing meetings with With the gold analyst at my prior employer, Fidelity, sort of, always knew about the merits of gold from a portfolio construction perspective, would always have it in the fund. By the way, just because it triggers people, I want to say it. I find it so amusing how upset gold bulls get at the idea of asteroid mining.

3. 1:53:50

   The idea of asteroid mining. Oh, yeah. No one, no one has ever been – I've never gotten more hate than from the gold crowd about the idea of asteroid mining and the asteroid psyche. Increasing supply. It's so funny. I mean it was like – talk about a challenge to your world's view. Wait. Are they mad about that new Alchemy startup? It's one of those things you have to – like you need to imagine technological disruption, right?

4. 1:54:16

   Like look at the diamond industry, right? Yes, absolutely. If you understood that technology disruption was possible, you probably built labs, like, you know, 20 years ago. Maybe you would have done something different with the diamonds in your family. But as far as, I mean, I do, we have spent a lot of time on, like, energy, on the industrial infrastructure, on natural resources. But we have not made it a big part of the portfolio.

5. 1:54:47

   We've done some things in private markets as far as trying to help with rare earths, but this is not through acquiring mines. It's more, you know, the problem with rare earths, it's not that they're rare, it's that refining them is a very dirty process. So we've invested in a company that has a chemical process for refining rare earths. And, you know, I actually think DARPA has done some pretty smart stuff.

6. 1:55:13

   They kind of have a lot of different efforts around this. But, yeah, I mean, I try to pay as close attention to all of it as I can because, you know, as an investor, you never know where a weak but important signal is going to come from. And so want to cast as wide a net as possible, but then also kind of focus maybe a portfolio on the areas where I do feel like maybe we have the biggest competitive advantage as a firm.