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Climate Tech Startup Investment

Globally there are 160 climate tech unicorns - companies valued at over $1bn - of which 8 are based in the UK.

According to the Tech Nation Climate Tech report 2022, the global climate tech ecosystem is maturing, with 53% of total investment in 2021 valued at over $250m, compared to just 10.5% in 2017.

This trend can be seen across the whole UK tech sector. In 2011 seed and pre-seed VC investment made up over 15% of the total investment mix in UK tech, by 2021 that proportion had dropped to 4.8%.

Early Stage Climate Tech Funding

The Tech Nation Climate Tech report is clear: if seed and pre-seed tech firms are to grow into the scaling engines of the UK economy, the supply of capital that sustains their early growth must be prioritised, or the UK runs the risk of stifling future stars of the global tech stage.

PwC’s third annual State of Climate Tech report states: the volume of critical early-stage funding required to scale up the next wave of climate tech success stories is trending in the wrong direction. The deficit of funding and the decline in the number of deals for early-stage start-ups that are looking to scale up appear to be deepening.

This issue particularly affects UK tech businesses when compared to their US and European counterparts.

Climate Tech Unicorns

Globally there are 160 climate tech unicorns - companies valued at over $1bn - of which 8 are based in the UK.

These are:

  • CamSemi - fabless company designing and manufacturing energy-efficient power conversion products
  • Vertical Aerospace - building technology to revolutionise how people fly, with the ultimate aim of making air travel personal, on-demand and carbon free
  • Octopus Energy - builds technology that reduces the cost of energy to improve the customer experience
  • Newcleo - developing a new industrial standard of clean, safe and inexhaustible energy production from Nuclei
  • Smart Metering Systems (SMS plc) - provider of multi-utility infrastructure connections and meter asset management solutions
  • Depop – a mobile marketplace that enables individuals to buy and sell items, with a focus on responsible consumption and sustainability
  • Ceres - developer of low cost, next generation fuel cell technology that creates a real world energy solution
  • OVO Energy – an energy technology company and supplier

The UK has a further 19 climate tech companies currently valued between $250m - $800m and is second in the world in 2021 and 2022 for climate tech investment, behind only the US.

Reasons to remain optimistic

Climate tech markets have shown resilience against a background of war in Europe, inflation, and turbulence in the capital markets. Also, climate tech’s overall share of global venture funding going toward climate tech start-ups remained high during 2022.

Richard Wheeler Associates works with technology-led companies in Climate Tech and CleanTech

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