Each successful founder taking a new climate technology to market is one more wizard behind the curtain of innovation. I'm sharing my thoughts from Endeavor's recent research on the under-recognized role of entrepreneurs in addressing climate change.
There is something missing from the recent global conversation on climate change.
There’s no time to delay in scaling innovations that will address the climate crisis. Recent reports and major gatherings make that clear. Yet rarely does anyone stress the role of those already driving the solutions — entrepreneurs.
- Climate Week NYC called for governments to unlock more finance to mitigate climate change, especially in the Global South. Despite the gathering's nearly 100 events on green finance, the people actually using capital to address climate change were woefully hard to find on the featured speaker lists.
- The Bill & Melinda Gates Foundation highlighted the urgent need for climate action in the 2022 Goalkeepers report. How do we tackle global hunger caused by climate change? The report says the answer is innovation, not just donations. Yet it doesn’t mention who is behind that innovation. This week, Breakthrough Energy featured inventors and entrepreneurs alongside public officials and corporate leaders at its inaugural summit — a big step in the right direction.
- Upcoming events like VERGE 22 and COP27 promise to be major forums for discussing the climate crisis. Thousands will gather in person to further the United Nations’ agenda on climate technology development and transfer, but how often will attendees hear from those who are creating that technology?
Meanwhile, private sector leaders are continuing to bring climate solutions to the masses around the world.
How can we better understand the entrepreneurs who are scaling innovation in climate tech?
Endeavor Insight’s recent global study, published with support from HSBC, is one of the first of its kind to examine the climate tech sector from the point of view of the founder. It brings together more than 200 interviews and data on more than 1,000 companies. The report captures the pathways to scaling their solutions and in-depth accounts of the challenges that founders face. Top-line findings include:
London is the training ground for the world’s climate tech founders.
The research examined how climate tech founders access support from six hub metros. This analysis found that London is generating university graduates who are then launching a climate tech company elsewhere, such as the Bay Area, Berlin and New York.*
University degrees earned by climate tech founders
London is not just exporting graduates to well-known hubs. There are countless stories of climate tech founders studying and working in London prior to launching transformative companies in the Global South. One such story is of Eduardo Porta, who earned a master’s in engineering for sustainable development from University of Cambridge and then worked for a British solar energy company before founding Econduce, an electric scooter company, in Mexico City.
Climate tech founders face persistent funding gaps and global talent challenges.
Founders interviewed for the report cited access to growth-stage capital as a top barrier for scaling climate tech companies.
“Climate tech is new, and without the benchmark of successful companies, the investors don’t know how to invest in the space, so they use their standard metrics,” said Kian Hoe Seah, founder of Heng Hiap Industries, a Malaysian company transforming ocean-bound plastic waste into manufacturing materials.
Minority founders and female entrepreneurs in climate tech face bias and experience even greater difficulty raising capital. Climate tech companies with at least one female founder were less than half as likely to scale than companies with all-male founding teams.* Strong networks and increasing representation among investors help with access to capital.
“I think that some of the challenges I’ve had with raising capital relate to the type of business that I have, and the fact that the end beneficiaries of my business are riders who are typically people of color, or people living in low-income neighborhoods. An investor, who more than likely is going to be a white male, is going to have a harder time connecting with that value proposition, because he is less likely to experience the problem that I’m solving for my customers,” said Sulaiman “Su” Sanni, cofounder of Dollaride, a New York-based technology platform that connects people living in transit deserts to private ride-sharing.
Access to talent was also a major obstacle, with qualified managers being more difficult to find than technical talent for scaling companies. Remote and foreign employees are increasingly necessary.
Founder-to-founder connections help the climate tech sector thrive.
Endeavor Insight’s unique approach to studying entrepreneurship networks shows the importance of mentorship and angel investment among founders. Companies are more likely to scale if they receive support from successful founders. When companies grow, their founders are then more likely to pay it forward in ways that help entrepreneurship ecosystems thrive over time.
“I mentor several female interns each year from leading universities around the world and assist them with developing the skills and tools necessary to succeed as the female entrepreneurs of the future,” said Inna Braverman, cofounder of Eco Wave Power, a company founded in Tel Aviv, Israel, that has developed technology for turning ocean and sea waves into green electricity.
A comparison of the six hubs and their “multiplier scores” shows that having a large climate tech sector is no guarantee of a robust entrepreneurial culture where founders are paying it forward. More can be done to encourage climate tech founders to support one another as they scale.
It is time to pull back the curtain on founders in climate tech.
When the founders working behind the scenes to drive climate innovation are largely invisible, it is difficult to understand their contributions, challenges and needs. And without that data, it is difficult to design initiatives that can accelerate their success in a field where speed is so desperately needed.
Endeavor Insights’ report attempts to pull back the curtain on entrepreneurs working in climate tech. By better understanding these founders' experiences, investors and policymakers arm themselves with the information to help.
This report is just the beginning of an essential and ongoing conversation. Anyone who hopes to speed climate innovation must talk to the individuals behind the inventions and systems that are actively decarbonizing our planet. Listen to founders’ needs, work to lower the barriers they face, and elevate their role as key drivers of solutions. Start that dialogue now by downloading the full report here.
Driven by our belief that high-impact entrepreneurs transform economies, Endeavor has been on a mission to build thriving entrepreneurial ecosystems in emerging and underserved markets around the world since its creation in 1997. Endeavor Insight is the research division of Endeavor that provides data-driven analysis and visualizations showing what makes entrepreneurial ecosystems thrive. For more information, contact insight@endeavor.org.
Leah D. Barto is the head of Endeavor Insight, the research division of Endeavor that provides data-driven analysis and visualizations showing what makes entrepreneurial ecosystems thrive.
*According to Endeavor Insight
