CONTRIBUTORS
Matthew Moberg
Portfolio Manager
Franklin Equity Group
United States
Sometimes, an innovation makes immediate use of just one valuable insight. More often, an innovation emerges in a way that may feel sudden and violent, but in reality is the result of years of work across different fields. This quarter, the exciting innovations we chose are largely the latter type. Across the board, they combine progress from fields as diverse as robotics and materials science to invent ingenious new forms that build on previous advancements. What unites them is their potential to impact our world and economy far beyond their initial use cases.
Advanced new robot “dog” uses reinforcement learning to do parkour
A team at Carnegie Mellon University recently created a robotic dog that jumps up blocks twice its height, deals with tricky terrain and can rove freely.1 Reinforcement learning, a technique that uses artificial intelligence (AI) to mimic how humans learn, enables this new robot dog to respond dynamically to its environment.
Why it matters: Researchers have changed focus to how a robot’s “mind” can learn to perform new actions with its body. As a result, robots are increasingly agile and responsive to their environments. This shift in approach may allow robots to learn how to perform basic daily tasks on our behalf.
New AI model can predict how proteins change in interactions with molecules
The first version of AlphaFold, a protein structure predictor, came out in 2020. In 2024, AlphaFold was updated in a major breakthrough—it can now predict the structures of proteins during interactions with other molecules with startling accuracy.2
Why it matters: The developers of AlphaFold hope to increase the power of the technology. The goal is to predict the structure of the >100,000 proteins in our bodies both by themselves and in interactions. If achieved, this would be a foundational advancement for drug discovery, moving it from the lab onto the computer.
Exhibit 1: Illustration of Protein Structure
Using artificial intelligence to predict protein structures is a foundational advancement for drug discovery
For illustrative purposes only.
Yeast-like bacteria found to digest carbon and produce ethanol
One of the answers to climate change may have been found in rabbit feces—the bacterium clostridum autoethanogenum.3 Like yeast, which eats sugar to make ethanol, this bacterium eats gaseous carbon and produces ethanol. One company is capturing waste carbon emissions from steel plants and placing them in a bioreactor with the bacteria.
Why it matters: The climate benefit of this innovation is twofold. First, these bacteria could produce a 30% drop in carbon emissions for steel plants, an industry responsible for 11% of global emissions. Second, the resulting ethanol can be used to make aviation fuel with 85% less carbon emissions.4
Researchers invent a shapeshifting robot
A new miniature robot that can change from liquid to solid takes its inspiration from the flexible sea cucumber.5 By embedding magnetic particles within the metal gallium, researchers built a robot with similar flexibility. It can jump up to 20 times its body length, climb walls, and even escape from a mock prison.
Why it matters: Although it is early, this new robot shows promise in biomedical applications. For instance, it could be used to remove a coin from a human stomach. Beyond medicine, it may be able to help assemble and repair hard-to-reach circuits or even act as a universal screw.
Advances in geothermal energy may help curb carbon emissions
New ideas to solve old problems can be found in the most unlikely of places. In this case, geothermal energy, one of the most promising forms of renewable energy, has emerged as a new application for hydraulic fracking.6 Solid stone at unprecedented depth is cracked, and water is injected. This produces steam, which drives turbines to produce electricity for the grid.
Why it matters: Today, less than 1% of energy is geothermal. But, geothermal energy, like fossil fuels, doesn’t vary with weather conditions or time of day, a major limiting factor for other renewable energy technologies. This means it could power the grid when other renewables are less available.
Endnotes:
- Source: Heikkila, M. “Is robotics about to have its own ChatGPT moment?” MIT Technology Review. April 11, 2024.
- Source: Callaway, E. “Major AlphaFold upgrade offers boost for drug discovery.” Nature. May 8, 2024.
- Source: Khan, Y. “A Yeast-Like Bacteria Can Cut Carbon Emissions While Creating Sustainable Aviation Fuel and Sneakers.” The Wall Street Journal. May 1, 2024.
- Ibid.
- Source: Osborne, M. “This Shape-Shifting Robot Can Liquefy itself and Reform.” Smithsonian Magazine. January 27, 2023.
- Source: Kim, J. “Enhanced geothermal systems: 10 Breakthrough Technologies 2024.” MIT Technology Review. January 8, 2024.
Investment potential and risks
There are also risks in investing in this or any asset class. The initial potential of any asset class may not carry over to any specific company or the entire asset class chosen for investment, over any investment time period. Any of the investment assumptions may never come to fruition. Investors should be prepared for potential losses as well as the possibility of investment gains. Ideas, products, companies or entire asset classes with positive past performance are not indicative of future results.
WHAT ARE THE RISKS?
All investments involve risks, including possible loss of principal.
Equity securities are subject to price fluctuation and possible loss of principal.
Investments in fast-growing industries like the technology and health care sectors (which have historically been volatile) could result in increased price fluctuation, especially over the short term, due to the rapid pace of product change and development and changes in government regulation of companies emphasizing scientific or technological advancement or regulatory approval for new drugs and medical instruments.
The opinions are intended solely to provide insight into how securities are analyzed. The information provided is not a recommendation or individual investment advice for any particular security, strategy, or investment product and is not an indication of the trading intent of any Franklin Templeton managed portfolio. This is not a complete analysis of every material fact regarding any industry, security or investment and should not be viewed as an investment recommendation. This is intended to provide insight into the portfolio selection and research process. Factual statements are taken from sources considered reliable but have not been independently verified for completeness or accuracy. These opinions may not be relied upon as investment advice or as an offer for any particular security.
Any companies and/or case studies referenced herein are used solely for illustrative purposes; any investment may or may not be currently held by any portfolio advised by Franklin Templeton. The information provided is not a recommendation or individual investment advice for any particular security, strategy, or investment product and is not an indication of the trading intent of any Franklin Templeton managed portfolio. Past performance does not guarantee future results.