America’s Nuclear Energy Opportunity with Kevin Kong, CEO of Everstar

0:00John Busby:On Builders, I interview founders, leaders, and CEOs about building their business and career. And today I speak with Kevin Kong. He's the founder of Everstar and they're solving a giant opportunity, which is how do we address the energy needs of the U.S. with safe nuclear energy. If you're interested at all in the topic of energy or how to have the confidence and passion to address huge problems, or if you're an engineer and you're wondering how to become a CEO or entrepreneur from an engineering background, you're going to want to devour this episode.

0:39John Busby:Hi, Kevin. How are you? Good to see you. Good to see you too, John. You're in New York City gearing up for a big storm in a couple of days. I guess when this episode actually comes out, we'll read all about it, but it's supposed to be a big one. Yeah. Snowpocalypse. Snowpocalypse. I live in Seattle. We get those in Seattle, The snowpocalypse here is when there's about a half an inch of snow. So we're going to talk about a topic I haven't covered on the podcast before. I'm really interested in it. It's about nuclear energy and some of the work that your company is doing. Put nuclear energy in context for the audience.

1:12John Busby:How important is it today to the world economy, to the U.S., and what are its prospects in the decades ahead, in your opinion?

1:20Kevin Kong:I like to introduce people who are new to nuclear by asking, what is the biggest problem in the world today? A lot of people might point to AI dominant for AI adoption, AI, AGI development, artificial general intelligence, and point to all the data center development as like the number one driver of the world interest economy, political drives. But I would dare to say there's something even bigger. We're already bottlenecked on energy shortages across the board. In most countries, maybe outside of China, where they don't have energy sources to be able to put the next half a trillion dollars worth of GPUs online coming from the next batches of NVIDIA.

2:05Kevin Kong:We're already running out of power from traditional sources like natural gas, coal plants, and even diesel generators. We've been largely in a flat era of energy demand for the last 20 years. And AI is dramatically changing that. Nobody saw this coming and nobody's ready for it. And these things are not like the supply chains of COVID and PPE masks. Those are simple to build, but data centers are extremely difficult. Power plants are extremely long tail supply chains to build out 10x. So this is going to take a monstrous effort, coordinate across government, private sector, financial mechanisms to really kickstart the power generation of technology.

2:51Kevin Kong:model. If AI is a$5 trillion market that is expected to be, this is probably way bigger than that because AI is just one of many use cases for energy. Nuclear is a key part of that equation because AI data centers like to run 24-7. These hyperscalers want to have of clean energy put onto the grid rather than fossil fuel driven. And there's just no traditional sources that are not bottlenecked. Diesel generators or gas turbines, there's eight, nine-year queues for these critical bottlenecks. You just can't get these sources online tomorrow, even if you have the money ready. You still have to wait.

3:34So if these queues are approximating nuclear construction timelines, that's interesting.

3:41Kevin Kong:nuclear timelines are approaching parity with traditional fossil fuel development. So now it's time to reconsider something that could be perfectly suited for AI development.

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4:28John Busby:Check it out at business.com slash plus. That's business.com slash P-L-U-S. What's the potential of nuclear energy, meaning you add up all the fossil fuel energy sources we have? Could nuclear match? Could it exceed? Like if we really invest in this in the world economy, what's the potential of nuclear energy compared to all other energy sources, I suppose? us?

4:58Kevin Kong:I'll just start from a couple of data points that underpin my assumptions. American nuclear today costs about$10 billion per reactor to build. Whereas in China, similar designs, American-based and French-based, they are costing about$2.5 billion. So 4x cheaper in China than what it costs in America today. And they build in five to six years instead of 10, 15 in America. so it's faster and cheaper very similar if not almost the same designs so that's already happening today and china's already putting up six to eight reactors coming online every year this is not hypothetical this is not uh they just started the program let's see how it goes they're already doing this in serial cadence today um so if we math this out america needs to approve 80 reactors to be constructed today, assuming we have a 10-year cycle, to have produced just as many reactors as China is already on track to do.

6:02Kevin Kong:They will already be the number one nuclear player by 2035. That's already happened. We're already too late. The opportunity to actually triple nuclear fleets of what we have today, we have about 94 reactors, so call it 100 gigawatts. The administration has said, let's meet the COP28, COP29 commitments to triple nuclear capacity, which makes us look like France, actually. So triple is not accidental. Triple gets us to France level, which is also base load level. So if baseload comes largely from nuclear and we use renewables for the margins, then we've got a pre-nix, which is resilient, clean, great business, great infrastructure all around.

6:50Kevin Kong:So to power the next 300 gigawatts of capacity to come online with the current American cost for each reactor, that's$4 trillion or more of spending. Just on that. So that's a lot of moolah. That's spending. That's not market cap. That's just spending. We've already committed to this. Now it's about how much time it takes and whether we're going to just wait until China figures it out already and becomes too big a problem to overcome or not. So our answer as a company is, let's get started.

7:26John Busby:So you founded Eversar. And what's it solving for specifically in the nuclear energy world? Is it time to market? Is that the primary solve? And how are you doing it? What's your approach? Right now, if we have to break it down, it will be time to market first.

7:44Kevin Kong:So what is blocking every single player from existing operators of nuclear assets to advanced reactor companies that want to put a generation four reactor that has passive safety, much different form factor and footprint. So you can put things on a truck bed. It has different kinds of spent fuel characteristics than, say, traditional Generation 3 reactors that are online today. So both sides have the very difficult problem of documenting everything because nuclear is all about safety. That's why American nuclear is trusted all around the world. They want to use the American apparatus of security and fuel management, engineering standards, material standards.

8:31Kevin Kong:It's safe. It's been proven safe. Safest by kilowatt hour per energy source. So that comes down to paperwork. Nuclear optimizing for safety equals paperwork. You need to follow procedures, you need to follow guidelines, you need to follow regulatory. rules that have been established for decades on end. So not just when you talk to the regulator, but also everything internal must be documented in paper trip. That has meant that so many people using the wrong tools like Word and SharePoint and fax machines have been just wrangling file cabinet rooms full of data from decades past. and now they have to keep the plants online much more efficiently.

9:23Kevin Kong:Now they're tasked with 10 tasks to do instead of five. They have to go qualify a new site for a potential new reactor because they're trying to meet the demands of the industry now. It's getting harder and harder to do their jobs. And the other side of the problem, which is going to be a time bomb, is the industry is dying out or retiring out. The people who know how to design, build, and maintain this industry have not had new builds. It's not an exciting industry. We've had four decades of supply chain and knowledge atrophy in the supply chain. It's like rocketry 20 years ago. The people who knew how to build rockets aged out and it became very difficult to do anything in the industry.

10:09Kevin Kong:Same thing is happening in nuclear today. It's a very expensive, difficult know-how to put into somebody's brain. We have very intelligent crops of people go through generations of passing down the knowledge until it stopped with 1979 when Three Mile Island happened. From then on, it was not a very lucrative or fulfilling career to go into holistically. So then the best talent goes elsewhere. They bleed out to other industries like oil and gas or even Google's of the world. How do you get that knowledge back? How do you help people who are still clamping on to this industry, keeping it together?

10:52Kevin Kong:How do you help them do more with less? We are building tools for those professionals to do their job efficiently and then hopefully enough time bought back so they can build the next 300 gigawatts. And in that pathway, there's like n number of different ways that AI accelerates. How do you find the right weather patterns, simulate that over time, soil compaction data, you merge that together into a form for environmental siting. You get that approval in six months, not three years. Then you can move on to the next phase, which is construction planning, project management, yada, yada, yada, yada.

11:28John Busby:So one bottleneck at a time. Kevin, how did you become interested in this part of the problem? You mentioned you don't have the top scientists or the top workers thinking about this. So what prompted you to do that?

11:46Kevin Kong:This actually goes back to my gripe with the American education system and broader education system. But I think people don't start with the why enough. They start with the what. They teach you univariate and then multivariate calculus without telling you first, like, why is this important for you to understand this? Kids are asking that question right now. Yeah. If you understand how many important, interesting applications there are, kids care way more about how do I make my F1 car faster? Ah, let me understand how CFD might affect that. And I can simulate how any tweak might change performance and trade-offs how this rate of change affects this rate.

12:32Kevin Kong:If you understand the mechanics of that and why you want to make that car go faster. and then learned how, damn, I mean, people would learn things so much faster and with vigor and love. For me, I didn't just jump out of bed one day saying I want to fix compliance and quality assurance for nuclear. Far be it from that. I started with like, what's an interesting problem for me to obsess my life over? What am I gravitated towards just naturally? And I think there's a few indicators if people are kind of still unsure. If you look at your YouTube feed or your Google search history, it's kind of a reflection of your soul.

13:12Kevin Kong:So I found myself looking at, and I don't think this goes for everyone, but I was looking at the comparative history of different technological advances to what was the early stages of oil and gas development in the 1800s looked like. the history of how Pennsylvania was actually the nexus of all things oil and gas and spread out to Texas later on. Texas was not the first place. And then later on, much later on to the Gulf area, all these things kind of came together. But I was doing a lot of like exploratory, you know, just big questions, like what is a big industry, big problem in the world? And I just went as deep as I can.

13:58Kevin Kong:I did this in genomics. I did this in mobile games. I did this in oil and gas. And that last one, like I couldn't shake my mind off of it. And I realized I went super deep into the standard oil history. It's the most fascinating story I had come across until then. Here's this one company led by a very strong-willed one person who is very controversial and like very like many sides to his persona. But I never realized that Robert Barron of John D. Rockefeller, as he was portrayed to me, was actually on a personal mission. His story to himself was, I'm bringing light to the world. The ruthless efficiency I'm applying to my business and wrestling with other inefficient players in the market so that we can bring the best end prices for the consumer reliably, stably.

14:57Kevin Kong:his mission to the world was I'm bringing light where previously people were burning whale blubber oil which is not good for fire safety and was not accessible to the masses and eventually later on when gasoline was the next big product not kerosene it became I'm bringing you know I'm making the world feel smaller. You can go coast to coast in a much shorter time. That expansiveness of his vision started from like, I'm going to make a wildcat industry get more stable, turn it into infrastructure. That was such a powerful idea. And I kept thinking from then on, how do you apply this to the next century?

15:45Kevin Kong:What is the path out of that hydrocarbonate that's been architecture in the last 150 years? What's the next thing? And that's where everything came from.

15:54John Busby:It's one thing to be interested in big problems. It's another thing to found a company that's purpose is to address those things. What's given you the confidence over the course of your career to tackle these massive things? You had a previous endeavor when COVID started out to provide masks and other safety things to the masses. Now transforming nuclear energy, tackling climate change. What gives you the confidence to say that you can do this?

16:32Kevin Kong:Maybe I'm a little delusional. I think a little degree of delusion is necessary. But I mean, I've done this many times now, like starting something new. you have to have a marriage of like these are the parts i can do well and there's a reason for me having to do this if somebody else is doing it better i should not be jumping in to do something as the nth player um just a waste of time and space um there's probably better things to do but if there is something that is not being tackled by the market today sufficiently well and I think I am well positioned to offer something that's asymmetrically uniquely good and I'm aware that I don't do everything well and I know what supplemental complementary skills need to come together to achieve that like 10x improvement in what should exist in the market then I take a shot at it so that's been the formula so far I think you're mentioning the PPE work I'd done over COVID that was, you know, the Confederate government was in disarray.

17:38Kevin Kong:There was no unified coordinated plan for how we're going to, you know, turns out PPE wasn't that effective, but at the time it seemed like life or death. How are we actually going to get a stable, secure supply to the American public? It was not very easy to coordinate. And there was a lot of scammers on the market. We work with a lot of nonprofits that were just skimming off the top. It was chaos. So we tried to do what the federal government really should have done, which is coordinate large pools of demand across hospital systems in New York City, the DOD, DOD at the time, the Department of Defense and other large institutions.

18:18Kevin Kong:We pooled their orders together and got priority access in queues for Chinese factories. We pre-vetted the factories for their quality, their prior track record, working with vetted suppliers and the match made. And we did this for zero profit. And we use that credibility to go for profit to sustain this with other private buyers. Like that was very different than how other people operated in the market. Like there was so many scammers, everybody out for themselves. We knew that something like this would establish the credibility that brought all the right people together. It's a better paradigm of trust in a critical time where trust was absolutely needed.

19:02Kevin Kong:Same thing for nuclear and what we're doing now. I looked around the space. I actually almost joined a few of the nuclear startups. I looked at advanced reactor companies. I looked at the fuel shortages and what could be done there. Laser-based enrichment was a very interesting topic for me at the time. But laser-based enrichment, fuel comes second to reactors. If reactors are not built faster, what's the point in building out all the capacity for fuel? You're not going to have customers. So you have to fix this problem first. But to get advanced reactors out to the grid or even more of the pre-licensed reactors, well, there's a lot of regulatory challenges ahead.

19:43Kevin Kong:Advanced reactors probably have a five to ten year lead up time, even with all the push from the administration. I'm not waiting five years for this to happen. I want to take part and accelerate that today. For pre-licensed reactors, you have a three-year period of just evaluating per site. Why? I looked over the shoulders of all these people doing difficult jobs. They're working in the wrong century, long decade for the demands of the times. We need to be able to go meet President Trump's challenge. How do you qualify site in three weeks? I don't know if it's going to be three weeks, but at least that's the right directional aspiration.

20:26Kevin Kong:It should be three months. If you have the data and you have great reasoning tools with the world's best experts curating what the AI puts out, then it should be three months. Why three years? America used to be a country of builders. It's now lawyers running the country. You got to take that back. China's doing well now because it's run by engineers building.

20:50John Busby:I bet there's a lot of folks in the audience, listeners, who are currently engineers or in corporate America and they have desires to become entrepreneurs. I'm curious, how did you use your time as an engineer? You worked as an engineer at Rakuten, at Bird. I think Bird's the scooter company, right? And how did you use that time to set yourself up for entrepreneurial success? Were you trying to build a nest egg? Were you trying to network? Were you trying to figure out how corporate America worked? Did it happen by accident? Sort of tell your story to jump from sort of like corporate America to entrepreneur.

21:35Kevin Kong:I think engineering really sets up people well for entrepreneurial success in the disruptive sense. Like if you're just doing a leverage buyout, private equity play, or taking mature companies to a slightly better position, I think that might be slightly different. But if you're trying to be an entrepreneur, creating a tech-enabled improvement to the world and bring that good or service to markets, you really need to understand the technology and the product well. First principles. Why should it exist? What really drives a strategic differentiation from other things in the market? And why is it important?

22:18Kevin Kong:You have to be able to sort around that. You have to hire the right people to be able to tell engineers why this is the most interesting thing you need to be working on today, especially now where power laws are playing out everywhere. And I, as an early stage company, and whether I like it or not, I'm competing with Anthropic for talent and attention. And investors are certainly making that kind of call too. Should I invest in Anthropik, looking at billion-dollar run rates for one product called Code and still growing at 50 % a year? Or should I invest in this very small company? It's a hard choice these days.

22:58Kevin Kong:So to stand out as a builder, you need to first know what the battlefield is and be able to break that down. So am I structurally set up for cloud code and open AI taking over my whatever idea I'm going to build for the next 24 months? Is this in the line of sight for them or does this actually need to be a standalone product? If it were to be a standalone product, how do I drive it towards FHIR's principles innovation that's going to make it so hard to displace, even if I were a topic? I mean, that kind of like understanding technology in and out, first principles, where does this need to go so that it's very difficult to replicate, even with a lot of money and time?

23:46Kevin Kong:I think being a really good engineer sets you up for that, the first principles view on the world. And for me, I think in our company where we want to go, another layer that as an engineer you think about a lot is thinking about a cost structure from first principles. Why is nuclear so expensive to build? Why does it cost$10 billion here and$2.5 billion over there? It's the same design. So the ability to just question those assumptions and requirements, design principles, all the way down to the base layer so that you can see where should we start the disruption? Should we start with fuel enrichment?

24:23Kevin Kong:Or is it actually that the capital costs, not the operating costs, per capital cost are nuclear high, therefore we should disrupt here. Why is one third to two thirds of the cost, depending on the project, going to interest? Ah, it's delays, time. What can accelerate the time? Why are people spending so much time? Is it pre, post, or during the construction? You start thinking very deeply because of that. So I think engineers are really set up for that kind of success.

24:54John Busby:I agree, particularly in the type of product and the type of service that you're building. Let me ask sort of the same question, though, when it comes to business acumen or soft skills or some of the areas that you need to flex as a CEO that you might not get day to day as a software engineer, a software engineering manager or a director. What's been that like for you learning how to be a leader, building culture, et cetera?