From CleanTech to ClimateTech, there has never been more awareness, anticipation or support for innovation and technology to drive a cleaner, more sustainable future. But to think we are even close to where we need to be for mass-scale, full-spectrum, unleashed potential would be a mistake. What for some might feel like a hyped-up, valuation toppy, over-capitalized greenwashing machine is really just the beginning of a global wholesale re-allocation of talent, capital and data into technologies and companies that will power a critical decade of climate adaptation and mitigation activity without a moment to spare.
The US’ decision to rejoin the Paris Agreement, followed by COP26, the highest profile meeting of it’s kind in history, combined with massive public awareness and pressure for countries and companies to make firm and ambitious commitments has raised the stakes for Climate Tech, aka CleanTech, like never before.
ClimateTech Venture investment (excluding Private Equity, PIPEs, SPACs and secondary transactions) is now 23x larger than it was a little over a decade ago in 2010 and 2.5x pre-pandemic investment levels in 2019. With innovation surging across the entire ClimateTech Landscape notable mega rounds included 🇸🇪 Northvolt’s $2.8B Series E Private Placement, 🇺🇸 Rivian’s collective $5.2B Pre IPO Series F and Growth Equity Rounds, 🇺🇸 Commonwealth Fusion Systems $1.8B Series B to commercialize fusion energy, 🇨🇳 SVOLT’s collective $2.5B Series B and B1 rounds, 🇺🇸 Redwood Materials $700M Series C, 🇺🇸 Beta Technologies $368M Series A, 🇺🇸 Bowery Farming‘s $320M Series C and 🇩🇪 Infarm’s $200M Series D to name a few.
With 45 ClimateTech Unicorns at the end of 2021 and 61 Mega Rounds ($100M+) over the last 12 months, this cumulative wave of investment in innovation and technology marks a meaningful milestone in the digital transformation of learning from early childhood though school, college and university to a new approach from industry for up-skilling and lifelong learning.
2021 delivered the world 28 new Climate Tech Unicorns, startups that are valued at over $1B USD via a venture funding round. This is more than 4x the number added in any previous year and brings the 2021 year end total to 45. 2021 also saw two Unicorns escape the herd, making their way to the capital markets via IPO in Rivian and Bird.
We are on a mission to map the future of Climate Technology.
Over the last quarter of 2021, HolonIQ led the development of an open-source taxonomy for climate technology and teamed up with regional partners around the world to identify the 1000 most promising Climate Tech startups globally. In the lead up the 26th UN Climate Change Conference of the Parties (COP26), HolonIQ’s inaugural Climate Tech 1000 includes Climate Tech startups and companies that are making a substantial contribution to climate change mitigation or adaptation through the application of new technology or scientific knowledge.
The Global Climate Tech Landscape 1.0 is an open-source taxonomy for climate innovation, providing a common structure and language for identifying, tracking and making sense of the breadth and depth of innovation happening in climate technology globally. The purpose of the Global Climate Tech Landscape is to create a granular and global open-source framework to enable insights such as:
Where are we seeing solutions and innovation? What is the velocity of formation, funding and growth? How is this changing over time?
Where are the gaps? When compared to the challenges we are facing, which areas are under-weight or white-space?
Where are we seeing traction and momentum? Where might new science and technology find a commercial market to apply new novel innovations and achieve self-sustainability?
Licensed under Creative Commons and as an open source project, the taxonomy is available for anyone to support their own work in climate innovation, to identify an area of focus, or to locate their organization and their peers on the landscape.
The Climate Tech 1000 is built region by region, to ensure the cohort is diverse, truly global and to shine a light on the inspiring innovation happening around the world. Many regional maps were built in partnership with ecosystem leaders such as Climate Salad in Australia, New Energy Nexus in Southeast Asia and China, and Climate Collective in South Asia.
Impact investing, the broad wave of focus on Environmental, Social and Governance (ESG) investment considerations, combined with rising awareness for the United Nations Sustainable Development Goals (SDGs) has created a new consciousness about social and economic impact.
Climate Technology is now a core focus area for the global investment community, alongside peer industries such as Health and Education, together allowing investors to participate in the growth of this special cohort and positively contribute towards a cleaner, more sustainable and inclusive future.
Impact Venture Investment in 2021 reached $104B, Climate Tech securing over $37B, Digital Health $47B and Education Technology Health $20B. Each of these industries has achieved more than 40% CAGR in Venture Capital investment since 2014, Climate growing at 50%
Benchmarked against impact peers, Global Climate Tech funding has three strong global investment leaders in the United States, China and Europe. Dominated by electric vehicles, renewable energy and battery and storage technology, global competition is strong and the geopolitical advantages not so subtle. We expect all three Climate Tech investment giants to accelerate with markets such as India and Southeast Asia to double down in specialist areas critical those economies.
Mega Rounds dominate funding in all three industries ranging from 46% of all funding dollars in EdTech through to 65% in ClimateTech.
Climate Tech boasts the largest share of mega rounds whilst preserving a significant slice of the funding pie to early stage investments. The asset intensive nature of many Climate Tech solutions often translates into a rapid acceleration of funding compared to peer industries once the technology is applied and considered feasible and has identified market potential. Given the different sizes of these industry groups, this does equate to a similar dollar level of early stage investment across the three but does reflect a bias of funding towards more mature companies.
66 healthcare funding rounds in excess of $100M, totalling $11.7B in ‘megarounds’ despite a rapidly cooling market
The Complete List of Global Impact Unicorns
$9.1B of Digital Health Venture Funding for Q1 2022, moderating a record-setting 2021. EU strong, US moderating, China collapsing