News & Analysis

driven by the PitchBook Platform
sistinechapelrobots1000.jpg
PB Q&A

Playground makes bets on risky tech so late-stage investors can invest in society’s future

Peter Barrett of Playground Global discusses what revolutionary technologies will be available a decade from now, why a vast amount of late-stage capital will continue to exist for deep tech and which cutting-edge technologies he thinks investors are wasting money on now.

While most tech VCs are spending the majority of their time betting on businesses with a relatively low technical risk, such as enterprise software or consumer applications, Peter Barrett, a general partner with Playground Global, is one of the few investors committed to putting money into startups focused on deep technologies that may take years to reach their potential and transform the world.

Since its founding in 2015, Playground Global has backed nearly 60 young startups working on highly technical, capital-intensive ideas. Companies in the Palo Alto firm’s portfolio include Relativity Space, a 3D rocket printing specialist that aims to soon compete with SpaceX, and PsiQuantum, a quantum computing startup that last October reached a valuation of $3.15 billion five years after Barrett led its Series A. In fact, Playground Global has backed at least six early-stage businesses that were valued at $1 billion or more in subsequent rounds.

peter-barrett-final-2.jpg

Peter Barrett
(Courtesy of Playground Global)

Playground Global, which has $850 million in AUM, takes an unusual approach to investing by employing engineers and scientists to help evaluate technologies the firm considers backing.

Since we recently covered two areas of tech innovation generating some of the biggest buzz—the metaverse and Web3—that don’t seem to have a clear long-term value yet, we discuss with Barrett the cutting-edge technologies we can expect to revolutionize our lives in the future.

This interview has been edited and condensed for clarity.

PitchBook: What new technologies should we expect to have 10 to 20 years from now?

Barrett: We will have entire new classes of computing, including quantum computers. Catalysts, materials and drugs will be computed and engineered at unprecedented speed, quality and scale.

We will have all kinds of transportation converted to running off ammonia and hydrogen. There are already companies like Universal Hydrogen. We led its series A year ago, and it will start flying 50-passenger planes this year.

We will have versatile, inexpensive battery technology that will not be made from lithium. I believe there will be functional cures for Type 1 and Type 2 diabetes. MRNA will be a dominant therapeutic platform that we’ll be able to program to address various maladies. Bipedal robots will fill the increasingly growing gap between our need for work and the availability of people. There will also be rockets that are printed from scratch and then launched on a regular basis.

A lot of these projects are very expensive. Will there be late-stage capital for them?

People misunderstand how much late-stage capital is available for supporting transformative technologies. Large family offices and sovereign wealth funds need investors like us to turn early-stage technically risky projects into companies where they can invest billions of dollars.

There are not many VC firms focused on deep-tech startups.

I suspect that given the trajectory of LP capital, there will be more deep-tech firms formed in the future. We have more deal flow of valuable and interesting companies than we ever had. For now, we share a common perspective and do many co-investments with Lux Capital and DCVC—though I think we have an unfair advantage because we have a bunch of scientists and engineers who worked with us in-house. We are experimentalists. For instance, we built out our own jet engine that runs on ammonia and that led to our investment in Universal Hydrogen.

Which cutting-edge technologies are you skeptical about?

We won’t have autonomous vehicles because we don’t need them. They are a huge distraction of talent and energy. We already have a technology that will reduce fatalities by 90% and increase traffic flow by 40%. It is called a roundabout. I don’t understand why Silicon Valley says “let’s put in $50 billion to try and chase this thing that we really don’t understand how to make rather than putting a hedge in the middle of the road.”

Do you feel the same way about flying cars and taxis?

There are now well over 100 flying car companies. The ones that will succeed are going to be hydrogen-powered. But I think it’s a technology for the 0.1%. People who will be using flying cars will be the same people who are getting helicopters from lower Manhattan to JFK [Airport]. I’m much more interested in urban technologies that work for everybody.

Featured image by Coneyl Jay/Getty Images

Join the more than 1.5 million industry professionals who get our daily newsletter!