Solutions to big problems – dreams, reality, and fraud

Solutions to big problems – dreams, reality, and fraud

Big  industrial  problems attract entrepreneurs  with big tips and investors with a high risk appetite. Starting with good intentions, some end up as disastrous scams as promised products prove to be unachievable.

How does this particular happen?   Such situations are uncommon but some entrepreneurs turn out misleading themselves and investors in the mistaken belief that obstacles will be overcome along with just more bucks and  patience.  

The infamous case of Theranos ended with  the  recent  confidence for fraud from the entrepreneur  who experienced falsely claimed to resolve the problems of quick and low-cost blood-specimen testing after raising hundreds of millions of bucks while falsely claiming success.

A more recent fraud case involves the hot area of carbon-free energy. The Nikola Corporation  went public with the objective of manufacturing vehicles propelled by energy cells using hydrogen. This is an old idea with practical limitations.  

As of September twelve, Nikola founder Trevor Milton was accused  in US Federal Court of securities fraud since the company failed to deliver any product while stating otherwise. Before the facts became recognized,   the company quickly reached a community valuation of  US$30 billion –  which approached that of the particular Ford Motor Company.  

Both of the above ventures made initially possible cases for attaining their products. They raised money because numerous investors in high-risk technology ventures are willing to  believe that all  technological dangers can be overcome by a great team led by a brilliant entrepreneur.  

1 reason for such high risk  is that entrepreneurs looking for big ventures may promote  technologies that show guarantee,   but possess a long history of failure to reach practicality. The entrepreneur promises an answer where others possess failed.

There is no shortage associated with well-intentioned personalities prepared to endorse such committed entrepreneurs on the basis of perception in the eventual success of perceived revolutionary technologies. For example , Holly Kissinger was over the board of Theranos, clearly not in his area of expertise.  

Fusion power

Among the present high-risk big ideas that are attracting business owners is nuclear fusion for power era. This addresses the  generation of “clean“ power through atomic fusion of hydrogen, which attempts to emulate the way energy is produced in sunlight and other stars.

Hydrogen gas is tightly confined under  enormous stress,   and extremely high temperatures.   Each time a critical condition is certainly achieved, two hydrogen atoms fuse,   producing one  helium atom,   along the way generating energy  (heat) and one neutron.

If scaled, such a process can theoretically  produce boundless amounts of  “clean” power. But the practical complications are enormous. Special aspects include the progress new   dependable materials  for  constructing the systems.  

For more compared to 60 years governments have invested many billions of dollars to realize this dream. As a result, it is often demonstrated that the fusion process can be achieved under laboratory conditions with regard to very short moments,   but the power generated does not considerably exceed the  applied  power required to sustain fusion.

So the technical objective has not yet already been reached, and nothing of the best-informed technologists can offer a plan. Developing such systems takes enormous sources and much specialized development in totally new areas.

Breakthroughs in electronics

We have been spoiled by pace of progress in practical  electronics  and software. During the past 60 years, computing energy has dramatically improved, following the progress contour of Moore’s Law – a duplicity of the component denseness of chips every single two years. As a result, the power of a room-sized mainframe computer of 6o years ago is now found in a smartphone.  

Popular objectives too often translate using this amazing  progress to chemical or mechanical technologies. During the same 6o years,   progress in blend technology has been in the areas of theory plus lab results, not practical power generation. The reason is that the technological problems in blend and in microelectronics are very  different.

This has  not prevented business owners from promising discoveries.   For example , claims are made that applications of artificial intelligence and machine learning will  result in the design of practical blend systems.  

There is no reliable timetable to  success in development of revolutionary technologies, and there is a long history of failure.   Breakthroughs happen yet never on plan, and investors should be prepared for such risks.  

Henry Kressel is a technologist and inventor and a long lasting private equity investor.