![](images/Logos/Bloomberg.png)
24 April 2023
![](images/images_04_24_2023/pic3.png)
For the past
week our Green Daily newsletters have focused on the climate tech set
to decarbonize world economies, featuring
winners of
BloombergNEF’s Pioneers awards. The coverage has led up to BNEF’s two-day
summit, which starts today. Click
here to follow our rolling update. Terminal subscribers can also
watch events at
LIVE <GO>. Later in the week, Bloomberg Green will hold our own
summit. You can attend virtually by
registering online. Today’s newsletter — the final one in our
special climate tech series — is about the money moving the green
transition. We take a deep dive look at who’s investing and where
they’re putting their money.
Following the $1.1 trillion climate tech boom
By
Eric Roston and
Akshat Rathi
Click here to read the full version of this story on Bloomberg.com.
Big money — from the three biggest economies in the world, as well as
scores of ambitious venture capitalists — is suddenly flying toward
startups promising to help the world build a carbon-free future.
It’s a shift from the world of software into the actual world,
following the trajectory of a tech founder like Peter Reinhardt, who
sold a software company for $3.2 billion in 2020 and now leads
carbon-storage company Charm Industrial. The newer startup, which he
co-founded in 2018, turns carbon-rich biomass into sludge that can be
safely buried underground. “We need to rebuild almost all the
infrastructure around us to eliminate fossil fuel emissions and return
the atmosphere to pre-industrial CO2 levels,” Reinhardt says. “That
will require a tectonic shift.”
That’s why horizon-scanning investors are suddenly less interested in
reseeding yesterday’s innovations (solar, wind and lithium-ion
batteries) than doing deals that push forward the frontiers of climate
tech. Decarbonized food, carbon-removing contraptions, futuristic
materials and next-generation fuels are now portfolio targets for
venture capitalists.
![](images/images_04_24_2023/pic4.jpg)
For early-stage investors, solar panels and electric vehicles are so
2011. By now these are relatively mature products built on the work of
previous decades. They’re doing the job they were built for: gradually
replacing fossil fuels. In fact, solar and wind are cheaper than coal
in most of the world today. That means market forces will turn power
grids a deeper shade of green with each passing year, and VCs can
focus on electrifying everything else.
“There is capital available for great entrepreneurs — and good
entrepreneurs — to tackle really hard problems in a way that wasn’t
available in that first wave” of renewables investment, says Gabriel
Kra, co-founder of Prelude Ventures. During the last 15 years, he
adds, “the core technologies have changed, the participants have
changed, the capital availability has changed, the building blocks
have changed. And that’s what’s leading to this second, more
successful wave of innovation.”
![](images/images_04_24_2023/pic6.jpg)
Investors won’t be working alone. Many of the most exciting startups
combine private and public backing. Examples abound, despite a tech
downturn that’s eliminated more than 120,000 jobs from the sector in
the US and a banking crisis that’s taken down VC favorite Silicon
Valley Bank.
Venture capital investment in climate tech reached a record $70.1
billion last year, according to HolonIQ Global Impact Intelligence.
That was an enormous 89% rise over 2021 at a time when overall VC
investment retreated, the tech sector shed jobs and Russia’s war in
Ukraine spiked oil and gas prices and unleashed a scramble for fossil
fuels.
Early-stage financiers are standing up against a backdrop of
government, corporate and consumer spending on emissions reductions
and adaptation measures. A balance of forces — investor enthusiasm
backed by public-sector spending, facing off against global economic
headwinds — will be a major topic of discussion during the two-day BloombergNEF
Summit on the energy transition in New York this week.
Green Play Ammonia™, Yielder® NFuel Energy.
Spokane, Washington. 99212
www.exactrix.com
509 995 1879 cell, Pacific.
exactrix@exactrix.com
|