One of the hottest investments of 2021 was climate tech, an industry that focuses on reducing greenhouse gas emissions or addressing the impacts of global warming.
Climate tech investments doubled from 2020 to 2021, with more than $40 billion deployed across 600 transactions last year, according to TechCrunch.
Panelists at New Orleans Entrepreneur Week on Wednesday discussed how their companies are helping startups looking to enter this sector.
Chante Harris, director of climate investment and partnerships at SecondMuse, said her firm focuses on energy, infrastructure and the built environment because there is real market opportunity, political and government resources and incentives on the corporate and private side.
“What we do is identify solutions across the globe, so we’re not looking at companies in just the U.S.,” she said. “We’re looking at companies that have the best solutions in all of these categories we focus on.”
SecondMuse operates on a venture studio model, a newer model of entrepreneurship that focuses more on the startup founder and providing hands-on support in the earliest stage of their journey. Many of these models have in-house employees who identify ideas with founders that have experience in their markets.
Harris gave an example of an entrepreneur creating carbon-neutral jet fuel who spent decades working for NASA building alternative fuels.
“We’re trying to solve a huge crisis,” she said. “The climate crisis is real. I know New Orleans is very much experiencing the results of this crisis. Just as importantly, we have a timeline to reach net zero and reach the goals corporations and governments have laid out.”
John Elstrott, co-founder of nonprofit venture design studio Applied Ecological Institute, said climate tech does not only encompass wind, solar and fuel companies but also industries such as energy, agricultural, packaging, transportation and construction. These sectors have to be rethought and reinvented so that business is conducted with “ecological intelligence” to operate “in harmony with the planet,” Elstrott said.
Elstrott, who helped launch an entrepreneurship center at Tulane University, said climate tech startups need to articulate their purpose, mission, vision and values in order to attract outside investment. They can then create viable products, plans, services and team members capable of executing the idea, he said.
Elstrott said his company is sourcing entrepreneurs from around the world to help solve climate problems. But many have more ideas than they are capable of implementing, so his company matches them with entrepreneurs who have successfully launched their ventures to help these first or second-time founders also succeed.
“You have to have the right intent or purpose in terms of what you’re trying to accomplish beyond just creating wealth and jobs,” he said.