Why pivot to climate tech now

📘 Goodbye Globalization — a few takeaways that stuck with me: I used the Easter break to read Elisabeth Braw’s Goodbye Globalization — a sharp, sober reflection on how the rules of global business are being rewritten, quietly but fundamentally, as everything we knew over the past 30 years since the post–Cold War era is being re-evaluated. In short, globalisation meant trade and national security operated in separate lanes; even when geopolitical tensions rose, governments were careful not to disrupt the flow of commerce. Companies spent decades building ultra-efficient global supply chains, and for a while, it worked — manufacturing boomed, goods flowed freely, and consumers enjoyed low prices. That era is now over. From COVID-19 to Russia’s war in Ukraine to the US–China tariff wars, recent shocks revealed just how fragile our interconnected systems are. After decades of economic integration, a new world order is taking shape. So what does it mean for #climatetech companies? 1️⃣ 𝐃𝐞𝐜𝐚𝐫𝐛𝐨𝐧𝐢𝐬𝐚𝐭𝐢𝐨𝐧 𝐁𝐲 𝐃𝐞𝐬𝐢𝐠𝐧 – Energy security is national security. The push for energy independence — often more than climate concern — is now the primary driver of the renewables transition. Cost-competitive, decentralised, and less geopolitically risky, clean energy is becoming a strategic asset. Just look at China: its electrification push isn’t driven by decarbonisation, but by the race for global competitiveness. 2️⃣ 𝐑𝐞-𝐢𝐧𝐝𝐮𝐬𝐭𝐫𝐢𝐚𝐥𝐢𝐬𝐚𝐭𝐢𝐨𝐧 𝐓𝐡𝐫𝐨𝐮𝐠𝐡 𝐓𝐞𝐜𝐡𝐧𝐨𝐥𝐨𝐠𝐲 – As global supply chains fragment, local production is becoming the answer. “Friendshoring” and “regionalisation” are the new buzzwords. Bringing manufacturing “home” — while staying economically viable — now relies on technology like AI, robotics, and localised supply chains (think raw materials and minerals). Climate tech companies have a real opportunity to build “resilient by default” industrial models that don’t depend on low-cost overseas labour, but on smart, scalable systems closer to their markets. 3️⃣ 𝐅𝐫𝐨𝐦 𝐆𝐫𝐞𝐞𝐧 𝐏𝐫𝐞𝐦𝐢𝐮𝐦 𝐭𝐨 𝐆𝐫𝐞𝐞𝐧 𝐀𝐝𝐯𝐚𝐧𝐭𝐚𝐠𝐞 – Being green isn’t just about values anymore — it’s becoming a competitive edge. Today, clean technologies unlock government incentives, help avoid trade barriers, and align with new industrial policies. The climate tech winners won’t just be the cleanest — they’ll be the most strategically aligned with Globalisation 2.0. At Extantia, we’re backing the climate tech founders who see this shift not as a headwind — but as the biggest tailwind of the decade!! #venturecapital #GoodbyeGlobalization

The climate conversation has permanently changed. We’re no longer just talking about the energy transition, carbon emissions, or regulatory compliance. Today, the conversation centers on preventing catastrophic loss. Over the last two decades, climate investment has evolved through distinct phases: 1️⃣ CleanTech 1.0 (2005–2015): Powering the energy transition with renewables. 2️⃣ ClimateTech 2.0 (2015–2025): Reducing emissions and focusing on sustainability. 3️⃣ ClimateRisk 3.0 (Now): Protecting individuals, businesses, and infrastructure from economic and physical loss. Companies that ignore these risks face the very real possibility of eroded enterprise value. This is beyond physical impacts from hurricanes and wildfires—we’re talking about billions of dollars in lost revenue, asset devaluation, and unmanageable liabilities that could cripple companies for years to come: 💠 Energy Instability: Weather-related outages account for 80% of major U.S. power failures, with disasters costing $120B+ annually. On top of this, significant price spikes are leading to energy costs crushing margins for customers. 💠 Infrastructure Vulnerability: First order effects from asset damage will drive up insurance premiums and erode asset value—U.S. home values could drop $1.5T in 30 years. Second order effects from investor skepticism could increase the cost of capital—annual investment in infrastructure could reach $6.9T by 2030 for companies to stay aligned with shareholder goals. 💠 Enterprise Value at Risk: Third-order effects from asset damage may reshape entire markets. Prolonged vulnerability could spur industry consolidation & exits. Evolving labor demands, along with the risk of stranded assets, threaten to upend traditional valuations. Supply chain disruptions alone may cause $25T in net losses by mid-century. 💠 Insurance Fallout: Already, entire regions are being deemed “uninsurable,” with insurers like State Farm & Allstate exiting high-risk markets. In 2024 alone, climate losses exceeded $400B, with a growing coverage gap of >60% that was not covered by insurance. With a targeted focus on both Climate x Insurance, Equal Ventures has had a unique opportunity to build a deep thesis in this space—investing in companies that mitigate climate-driven operational risks, create financial resiliency in volatile markets, and redefine enterprise security by building strategies that secure both physical and digital assets. Companies like: Stand, Odyssey Energy Solutions, Texture, Shadow Power, David Energy 💡 Check out our latest blog post - link in the comments below. Rick Zullo Adam Chadroff Sophia Dodd

We had an amazing conversation with Kim Zou, CEO of Sightline Climate, this week, about venture/growth investment trends in climate tech. She spoke to us from London Climate Week, where she said that "this year feels completely different." For the first time, investors from the U.S., Middle East, Asia, and Canada are flocking to what's historically been a sleepy European conference. The reason? "Definitely pullback in the U.S." We're witnessing a geographic rebalancing. European companies that once came to America for growth capital are staying home. American investors are scouting European opportunities. And the conversations reveal a sector in the middle of what Zou calls a "trickier, tactical" recalibration. It was a really fantastic conversation. Here are some takeaways: 🎯 Tariffs worry investors more than IRA repeal. With 54% of climate tech companies having hardware components, complex supply chains are once again in flux. 💰 The "missing middle" is getting worse. Companies need $45-$100M to build first commercial facilities but face "venture-level risk with infrastructure-style returns." Meanwhile, the DOE – historically the bridge funder – is pulling back just as a "massive wave" of companies hit this critical gap. 📈 Acquisitions doubled, but at "opportunistic costs." Investment dropped 19% in H1 2025, but M&A activity surged – mostly at undisclosed valuations. Lots of bargains to be had for investors. ⚡ Some sectors are thriving anyway. Grid-enhancing tech had its best quarter ever, thanks to AI power demands. The winners: companies that save customers money rather than asking for green premiums. The voluntary sustainability market is "definitely drying up." 🌍 Europe's structural advantages are real. U.S. investors aren't just fleeing uncertainty – they're finding opportunities. Europe's funding gap starts earlier (Series A vs growth stage), and European LPs are still hedging against climate exposure. We're watching climate tech mature from hype-driven to pragmatic. The companies with clear value and realistic exit strategies are finding capital. For investors, the geographic arbitrage opportunities are real, but so are the trade-offs (regulatory complexity, higher electricity costs in Europe). Listen to the full episode for a breakdown of investor sentiment, deal flow, and geographic shifts: https://bit.ly/45LBJXa

While everyone's paralyzed by the $3.7 billion funding cut, the smartest companies in climate tech are making their biggest moves yet. Not waiting. Building. Redwood's Brilliant Pivot: JB Straubel's Redwood Materials deployed 700 used EV batteries to power a Nevada data center. Not recycling them. Using them as-is for grid storage. While Li-Cycle went bankrupt begging for government money, Redwood raised $2 billion privately. Why? They solved real problems for real customers. 95% material recovery rate. Contracts with Ford, Toyota, Panasonic. No subsidies needed. The Nuclear Rush Is Real: Amazon paid $650M for one data center because it sits next to a nuclear plant. Microsoft's restarting Three Mile Island. Google signed for 500MW of small reactors. Not because of climate goals. Because AI/data center demand could hit 400 terawatt-hours by 2030. They need reliable power. Now. Who Else Is Moving? Rondo's heat batteries: Already powering New Belgium Brewery. AtmosZero's heat pumps: Replacing industrial boilers today. Not pilots. Revenue. Climate tech funding grew 15% YoY despite everything. First-stage startups outperforming the broader VC market since 2019. The Opportunity Map: - Industrial heat: 30% of emissions, almost no solutions - Grid flexibility: Every solar farm needs it - Building efficiency: Boring but massive - Carbon removal: Microsoft alone needs megatons The companies attacking these problems right now, while others wait for "policy clarity" will own the next decade. The Harsh Reality: Subsidies created zombie companies. Their death creates opportunity. Every competitor frozen in fear is market share you can take. Every company "reassessing strategy" is a customer you can win. 2001 dot-com crash gave us Google's dominance. 2008 gave us Uber and Airbnb's growth. 2025's climate shakeout? We're watching it create winners now. The Real Question: Your competitors are in defensive mode. What offensive play are you running? Who's already pivoting successfully that we should watch? The bold don't wait for permission. They build the future while others debate it. #CleanTech #EnergyTransition #DataCenters #NuclearEnergy #Innovation

🍏 The Climate Bill is Due: Why Sustainability is Now the Smart (and Cost-Effective) Choice 🍏 The era of cheap inaction on climate change is over. The tipping point has been reached, and the economic costs of inaction are staggering. A recent study predicts a 19% global GDP loss by 2050 due to climate disruptions. This isn't science fiction, it's a looming recession driven by extreme weather, resource scarcity, and societal instability. The good news? Mitigating climate change is not just environmentally necessary, it's economically sensible. Here's why: ✅ Prevention is cheaper than cure: Investing in renewable energy, sustainable practices, and carbon capture is far more cost-effective than dealing with the trillions in damages caused by unchecked climate change. ✅ Sustainability is the new market advantage: Consumers are increasingly choosing eco-conscious brands. Businesses that prioritize sustainability will not only attract a wider audience but also future-proof their operations. The Science Based Targets initiative (SBTI) offers a clear roadmap, though it's not without its limitations. While SBTI may not be a perfect solution, it creates an overarching direction. It helps companies develop strategies for their sustainability pivot and adds value to their sustainability reports. SBTI can provide organisations to set concrete targets – short, medium, and long term – with set timelines, fostering transparency and accountability to reflect it on their annual sustainability report to inform their varied stakeholders and to instill public confidence of their direction and vision. However, achieving these targets requires a system-wide transformation. This isn't just about swapping lightbulbs. It's about rethinking supply chains, optimizing logistics, and embracing circular economy principles. It demands a cultural shift within organizations, fostering innovation and employee engagement. The road ahead requires careful system thinking, collaboration, and long-term planning. But the alternative is simply unsustainable. Time to pivot. Time for sustainability. #ClimateAction #SustainabilityPivot #SBTI #GreenEconomy #ASEANSustainabilityAmbition #SystemsThinking #CoordinatedCollaboration #Strategy