A New Era for Climate-Focused Venture Capital

The Energy Gang

During the height of the pandemic in 2020, venture capital poured into climate technologies at record levels. It was a happy surprise amidst a collapsing economy and years of investment stagnation.

Venture investments in climate tech topped $17 billion in 2020 across more than 1,000 deals. Five years ago, it had fallen to $5.2 billion — a 30 percent decrease from a previous peak in 2011.

Our guest co-host this week is Emily Kirsch, the founder and CEO of Powerhouse. She’s also the host of Watt It Takes, the entrepreneurship series about founders tackling climate change.

Suddenly, it’s cool to be putting your money into the sector again. And there’s something different about today’s rise in enthusiasm. The first wave was all about the “coolness” of cleantech — thin-film solar, electric sports cars, printable batteries. It was also about proving cost curves.

Kara Swisher put it bluntly in the NYT last year: the world’s first trillionaire will be a greentech entrepreneur.”

Today, there’s much more technological maturity — bigger scale, bigger and better data, and more resources to tap for startups.

There is also a deeper moral responsibility infused with investments. If you are running a major VC firm or a corporate venture arm, you are out of the loop if you don’t have a climate component of your portfolio. Andrew Beebe of Obvious Ventures argues we’ve entered the “climate decade” in VC.

This week: climate tech isn’t just having a moment. It’s having an age, a period, a generation. Why we are at the start of a climate tech era in venture capital.

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