Can investors win by betting on early-stage innovations in hard-to-decarbonize sectors such as energy, transportation, agriculture and heavy industry?
The answer doesn’t matter only to venture capitalists. If you believe that we need fundamental science and engineering innovation to climb our way out of the climate crisis, it’s an important question.
Plenty of reasonable observers say the answer is no. Case in point: The 2016 MIT report Venture Capital and Cleantech: The Wrong Model for Clean Energy Innovation by Ben Gaddy and Varun Sivaram.
But things have changed since “Cleantech 1.0,” the first wave of investment in the sector that resulted in a lot of bankruptcies — but also some big hits like Tesla, Sunrun, and Nest.
Capital is flowing back into the sector at stunning rates, as venture investors all turn their attention to climatetech. So do the arguments against deeptech climate venture capital hold up today?
To explore this question, Shayle turns to Ramez Naam, another veteran of Cleantech 1.0. Ramez and Shayle go point by point, covering questions such as: Does climatetech take too much capital to scale? Is the time to commercialization too long? Is the exit landscape still relatively unattractive? Will this new climatetech boom lead to another bust?
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