Insights from Leading Climate VC Firms
The recent SF Climate Week was a hub of innovation and forward-thinking, attracting a packed venue filled with attendees eager to explore the future of climate-tech.
The event featured renowned partners from Lowercarbon Capital, Congruent Ventures, and Third Sphere, all of whom shared their insights on the critical trends shaping the industry.
With additional panels focused on energy, forestry, and agriculture tech, the week was a testament to the growing momentum in climate-focused investments.
Here are some of our key takeaways.
Climate-Tech Investments: The Future is Bright
One of the major themes echoed throughout the panels was the strategic focus on Climate 2.0 investments. Venture capitalists are increasingly looking for opportunities that not only promise significant returns but also contribute to a positive environmental impact.
“From a capitalist perspective, the 5 to 10 year period is going to be absolutely gangbusters for climate. We have to decarbonize the entire economy, the companies that make it in the next couple of years are going to have phenomenal outcomes.”
— Abe Yokell, Co-Founder and Managing Partner, Congruent Ventures
Technological breakthroughs: A new era of Innovation
The climate-tech sector is witnessing rapid advancements across various technologies, including electrification, artificial intelligence (AI), gene editing, and autonomous systems. These innovations are not only driving the industry forward but also offering new ways to address the challenges posed by climate change.
“Last year the number of disasters that are deemed billion-dollar disasters was the highest ever in a single year, at 28. ClimateAI helps companies anticipate and mitigate those risks by offering seasonal forecasts and long-term climate projections, enabling better decision-making in both the short and long term.”
— Lena Backe, Product & Innovation, ClimateAI
Partnerships & policies: The power of collaboration
The importance of public-private partnerships was a key takeaway from the discussions, with speakers highlighting how policy-driven incentives like the Inflation Reduction Act (IRA) are catalyzing progress in the climate sector.
“There are parts of the IRA that are making significant progress in terms of job creation, especially in manufacturing hubs like the Battery Belt. The momentum in states like Georgia, South Carolina, and Arizona is such that it would be challenging for legislators to reverse this progress.”
— Ian Magruder, Head of Partnerships, Rewiring America
Owning your narrative: The power of storytelling in Climate Tech
For startups in the climate space, developing a strong narrative is crucial. It's about reshaping environmental stories, creating a distinct point of view, and translating innovation into tangible value that resonates with customers.
“The climate choice—or the clean choice—needs to be the affordable and accessible choice. That’s why we invest in companies developing products and services that are not only better for the environment but also outperform their incumbents in terms of cost, quality, and efficiency.”
— Clea Kolster, PhD, Partner and Head of Science, Lowercarbon Capital
Talent in Climate Tech: A call for diverse skills
The climate-tech industry is ripe with opportunities for professionals from various backgrounds. With the sector's collaborative nature, there's an exciting chance for growth while contributing to a purpose-driven mission.
“Climate is eating everything; it’s going to take over the entire economy.”
— Abe Yokell, Co-Founder and Managing Partner, Congruent Ventures
Conclusion
From strategic investments and technological breakthroughs to the importance of partnerships and narrative-building, the insights shared by leading VCs provide a roadmap for the future.
As climate tech continues to grow, the industry will need to attract diverse talent, foster collaboration, and remain agile in the face of an ever-changing landscape.