The conversation with Jeppe Høier covers various topics related to corporate venture capital (CVC). Jeppe discusses the structure of CVCs, the different types of investments they make, the challenges and benefits of working with CVCs, and the differences between European and US CVCs. The discussion also touches on the lengthy process of engaging with CVCs and provides tips for startups to navigate this process. Overall, the conversation aims to provide insights and understanding of CVCs for startups and investors. In this conversation, Jeppe Høier and Samia discuss the role of corporate venture capital (CVC) in the climate tech industry. They explore how CVCs differ from traditional venture capital firms and the advantages they offer to startups. They also discuss the challenges startups face when seeking investment from CVCs and provide advice on how to navigate the landscape. Additionally, they touch on the changing landscape of CVCs and the importance of building relationships with corporates.

Takeaways

Corporate venture capital (CVC) is an important player in the startup ecosystem, with corporates having a significant role to play in the energy transition and climate tech.

The structure of CVCs can vary, with different decision-making processes and strategic goals. Some CVCs invest for return purposes, while others invest with the goal of potential acquisition.

Engaging with CVCs can be a lengthy process due to the bureaucratic nature of large corporations. Startups need to understand the decision structure and process of the CVC they are working with.

Information flow and communication between startups and CVCs can be challenging, but it is crucial for successful collaboration. Startups should consider limiting access to information rights and keeping ownership below 5% to protect their interests.

European CVCs are still developing and may not have the same level of maturity and experience as their US counterparts. However, the European startup ecosystem is growing, and more success stories are emerging. Startups should seek value creation from CVCs beyond just financial investment, such as access to assets, brands, customers, data, and expertise.

When looking for investment from a CVC, startups should understand the specific value they are seeking and target CVCs that align with their industry and goals.

CVCs can provide startups with revenue opportunities, cost savings, and access to their network and resources.

Startups should conduct due diligence on CVCs and seek references from other portfolio companies to understand the value they can bring.

The CVC landscape is constantly evolving, and there is a need for more deep tech investors in the climate tech space.

Corporates can also play a role as limited partners (LPs) in venture funds, but it may take longer to raise capital from them.

Building relationships and understanding the decision-making structure within corporates is essential for successful collaboration with CVCs.

Links

Corporate venturing newsletter

Research: The Lifecycle of Corporate Venture Capital

Contact Us

Guest: https://www.linkedin.com/in/jeppehoier/

Email us: info@climatetech360.com

Host: https://www.linkedin.com/in/samiaqader/

Susana Lopez discusses her journey into clean tech and the importance of infrastructure development in emerging markets. She shares her experiences in working with private equity funds and the challenges of aligning the goals of different investors. She also explains the concept of blended finance and how it can be used to finance infrastructure projects. The conversation highlights the need for sustainable and impactful infrastructure development considering social and environmental factors. Early engagement and mitigation of negative impacts are key in infrastructure projects. Sometimes projects are successful when developers are willing to address environmental and social issues and work closely with investors. However, there are challenges in funding first-of-a-kind projects and attracting infrastructure funds to emerging markets. Blended finance and green hedging instruments can help mitigate risks and attract more capital to these markets. The goal is to develop infrastructure at scale and pace to meet the needs of developing economies.

Takeaways

Infrastructure development is crucial for economic and social development in emerging markets.

Blended finance, which combines public, private, and philanthropic capital, can finance infrastructure projects.

Aligning the goals of different investors, such as impact-focused donors and return-focused private investors, can be challenging.

Sustainable infrastructure development requires considering both social and environmental factors.

Patient capital and long-term investment horizons are needed to support infrastructure projects. Early engagement and mitigation of negative impacts are crucial in infrastructure projects.

Successful projects require developers to address environmental and social issues and work closely with investors.

Funding first-of-a-kind projects and attracting infrastructure funds to emerging markets are challenges that must be addressed.

Blended finance and green hedging instruments can help mitigate risks and attract more capital to emerging markets.

The goal is to develop infrastructure at scale and pace to meet the needs of developing economies.

Contact Us

Guest: https://www.linkedin.com/in/susanalopezlopez/

Email us: info@climatetech360.com

Host: https://www.linkedin.com/in/samiaq/

Aira is a one-stop shop for heat pumps, providing installation, maintenance, and financing solutions. They have a vertically integrated model and have their own installation and sales force. They also offer a comfort guarantee and focus on customer service. Heat pumps are more efficient, saving customers 40% on heating costs and reducing carbon emissions by 75%. Aira has acquired heat pump installation providers in each of their three initial markets: Germany, Italy, and the UK, and has plans to expand into other markets in Europe. Aira's heat pumps come with solid connectivity and control features, allowing for remote monitoring and diagnosis of issues. They also have an integrated app for customers to monitor their energy usage and savings. Aira's success can be attributed to its focus on commercialization and scaling, as well as its strong team and support from the Vargas umbrella. Aira has also recently secured a €200 million debt facility specifically for heat pump securitization, the first of its kind. They offer a monthly payment model for heat pumps, removing the upfront cost for customers. The company's affiliation with Vargas, a leading climate tech investor, provides credibility and access to expertise and contacts. Aira is focused on disrupting the heat pump industry by offering innovative and customer-friendly products.

Takeaways

Aira offers subsidies and financing solutions to make heat pumps more affordable for consumers.

They have a vertically integrated model and provide installation, maintenance, and financing solutions.

Aira has acquired heat pump installation providers in Germany, Italy, and the UK and plans to expand into other markets in Europe.

Their heat pumps come with solid connectivity and control features, allowing for remote monitoring and diagnosis of issues.

Aira has raised €145 million in a Series B funding round to make clean energy tech affordable and accessible.

They offer a monthly payment model for heat pumps, removing the upfront cost for customers.

Aira has secured a €200 million debt facility specifically for heat pump securitization, the first of its kind.

Their affiliation with Vargas provides credibility and access to expertise and contacts.

Aira aims to disrupt the heat pump industry by offering innovative and customer-friendly products.

Contact Us

Guest: https://www.linkedin.com/in/anelauny/

Email us: info@climatetech360.com

Host: https://www.linkedin.com/in/samiaq/

In this episode, Lara Pierpoint discusses the Trellis climate program developed by Prime Coalition to address the gap in first-of-a-kind financing for climate technologies. The program focuses on providing catalytic capital to support the scaling and commercialization of climate innovations. Lara explains that the program aims to bridge the gap between early-stage venture funding and infrastructure investment, which is crucial for the successful deployment of climate technologies. She also highlights the challenges of aligning the interests of private capital focused on returns with philanthropic capital focused on impact. The program seeks to ensure that the supported technologies have a pathway to scale and can attract traditional investment in the future. In this conversation, Lara talks about the role of catalytic capital in bridging the financing gap for climate tech startups. She explains that catalytic capital funds projects that traditional investors may not be willing to support due to various risk factors. Lara's call to action for climate tech startups is to start thinking about long-term vision and how to cross the financing gap early on.

Takeaways

The Trellis climate program addresses the gap in first-of-a-kind financing for climate technologies.

The program provides catalytic capital to support the scaling and commercialization of climate innovations.

It aims to bridge the gap between early-stage venture funding and infrastructure investment.

Aligning the interests of private capital focused on returns with philanthropic capital focused on impact is a challenge.

The program ensures that supported technologies have a pathway to scale and can attract traditional investment in the future. Catalytic capital funds projects that traditional investors may not support due to risk factors.

Climate tech startups should start thinking about long-term vision and how to cross the financing gap early.

Links

https://www.primecoalition.org/programs/trellis-climate

Report: Barriers to the timely deployment of climate infrastructure

Contact Us

Guest: https://www.linkedin.com/in/lara-pierpoint-5a740515/

Email us: info@climatetech360.com

Host: https://www.linkedin.com/in/samiaqader/

This conversation with Nolan Lindquist at the Center for Active Stewardship (CAS) covers various topics, including CAS’s focus of CAS on climate transition risk and the limitations of using emissions as a universal metric. The conversation emphasizes the importance of fundamental analysis and developing a real rapport with companies to navigate the complex process of decarbonization. The discussion also introduces a tool called Splice, which provides a visualization of a company’s emissions. The conversation delves into the different types of emissions and the significance of trading activities. It highlights the importance of transparency in understanding the quality and cost of emissions reductions. The conversation concludes by discussing the transition from ESG 1.0 to ESG 2.0, focusing on activity-centric reporting and the need to align disclosures with long-term value creation.

Takeaways

The Center for Active Stewardship focuses on climate transition risks and aims to redirect corporate investment towards net zero by finding win-win opportunities that drive shareholder value.

Emissions may not be the best metric for measuring financial materiality of climate change, especially for industries with low energy intensity and high reliance on grid electricity.

For many companies, decarbonization will likely be a passive process as utilities shift away from fossil fuels to renewables.

The decarbonization of hard-to-decarbonize industries, such as steel and cement, requires radical shifts in production processes and significant government support. Active management is crucial in addressing strategic dilemmas related to ESG issues.

Transparency is key in understanding the quality and cost of emissions reductions.

The transition from ESG 1.0 to ESG 2.0 involves activity-centric reporting and aligning disclosures with long-term value creation.

Links

FT: The cast against carbon emissions as a universal metric

Splice: Center for Active Stewardship

Research: State of Play: Proxy Season 2024

Contact Us

Guest: https://www.linkedin.com/in/nolanlindquist/

Email us: info@climatetech360.com

Host: https://www.linkedin.com/in/samiaq/

Summary

This conversation with James Vaccaro discusses the work of the Climate Safe Lending Network, a multi-stakeholder network focused on accelerating the transition to a sustainable economy. The network brings together banks, investors, NGOs, regulators, and academia to share knowledge, provoke thought, and drive change in the banking sector. James highlights the importance of understanding the emissions generated by a company's banking practices, particularly the financing of fossil fuel industries. He emphasizes the need for companies to engage with their financial partners and demand a shift towards greener investments. He also discusses the role of universities and large corporates in leading the movement towards sustainable finance. The conversation explores the role of banks in the transition to a sustainable economy and the challenges they face. It discusses the need for banks to restrict capital to fossil fuel companies and transition to greener alternatives. It highlights the importance of regulatory action and government intervention to drive change. The conversation also touches on the role of technology in the transition, emphasizing that not all solutions require high-tech interventions. It concludes with a discussion on the potential of fintech and challenger banks to accelerate the transformation of the financial supply chain.

Takeaways

The Climate Safe Lending Network is a multi-stakeholder network focused on accelerating the transition to a sustainable economy.

Companies need to understand the emissions generated by their banking practices, particularly the financing of fossil fuel industries.

Universities and large corporations have the power to lead the movement towards sustainable finance. Banks need to restrict capital to fossil fuel companies and transition to greener alternatives.

Regulatory action and government intervention are crucial to drive the transition.

Not all solutions require high-tech interventions; simple changes in behavior and practices can have a significant impact.

Fintech and challenger banks have a role to play in accelerating the transformation of the financial supply chain.

Links

The Carbon Bankroll 1.0

The Carbon Bankroll 2.0

Contact Us

Guest: https://www.linkedin.com/in/james-vaccaro/

Email us: info@climatetech360.com

Host: https://www.linkedin.com/in/samiaqader/

This conversation with Kajsa Ryttberg-Wallgren, EVP of Global Growth at H2 Green Steel, explores the milestones achieved by H2 Green Steel in securing funding for its first-of-a-kind Boden plant. The discussion covers topics, such as early financing, partnerships and value chain support, securing site and power allocation, team structure and growth, joint ventures, and the massive fundraising round. The conversation also delves into the debt structure and equipment financing, working with different types of investors, and the key milestones that enabled H2 Green Steel to raise €1.5 billion in equity financing and sign definitive agreements for €4.2 billion in debt. The discussion covers topics such as securing debt from export credit agencies, early consideration of project finance, replicating financing structures for future projects, power purchase agreements and energy sourcing, securing iron procurement, carbon credits as part of the revenue stack, the financing structure for future projects, involvement of strategic partners, scaling the team and organizational structure, challenges in recruiting specialized talent, milestones and de-risking for financing, location as a key factor in bankability, and the importance of timing in success.

Takeaways

Early consideration of project finance and learning from similar projects can help structure financing, from the beginning.

The financing structure can be replicated for future projects, but location-specific factors must be considered.

Carbon credits can be an important revenue stream for projects with low or no CO2 emissions.

The team and organizational structure must evolve as the company scales and moves into different project phases.

Recruiting specialized talent from around the world is crucial for success in capital-intensive industries.

Milestones and de-risking are important for attracting financing partners.

Location plays a significant role in the bankability of projects, considering factors such as renewable energy availability and cost.

Timing is a crucial element of success, as market conditions and regulatory frameworks can impact project feasibility.

Contact Us

Guest: https://www.linkedin.com/in/kajsaryttbergwallgren/

Email us: info@climatetech360.com

Host: https://www.linkedin.com/in/samiaqader/

This conversation with Petros Lekkakis explores the concept of 'first of a kind’ (FOAK) in the climate tech space, which refers to hard asset companies developing technologies at the demonstration or pilot scale and seeking to deploy their first commercial minimum viable product. The discussion highlights the importance of FOAK technologies in achieving net-zero targets and the need for collaboration between venture capital and infrastructure investors to bridge the financing gap. Key players in early infrastructure financing include venture capital firms, concessionary capital providers, growth equity investors, strategic players, government agencies, and multilaterals. The conversation also addresses the knowledge gap in commercializing technologies and the role of specialized funds in providing the necessary expertise and capital to support early infrastructure projects. Two case studies, H2 Green Steel and Infinium, highlight the importance of securing long-term contracts and off-takes to de-risk projects and attract capital. Learnings from the financing markets of solar and LNG provide insights into risk mitigation, project structuring, and the importance of standardization. The episode concludes with a startup checklist that includes team building, contract finance, tech demonstration, focus on FOAK projects, pipeline development, strategic interest, and a solid business plan.

Takeaways

First-of-a-kind refers to hard asset companies developing technologies at the demonstration or pilot scale and seeking to deploy their first commercial MVP.

Collaboration between venture capital and infrastructure investors is crucial to bridge the financing gap for first-of-a-kind technologies.

Key players in early infrastructure financing include venture capital firms, concessionary capital providers, growth equity investors, strategic players, government agencies, and multilaterals.

Specialized funds can provide the necessary expertise and capital to support early infrastructure projects and bridge the knowledge gap in commercializing technologies. Securing long-term contracts and off-takes is crucial for de-risking infrastructure projects and attracting capital.

The success of H2 Green Steel and Infinium demonstrates the importance of securing firm off-takes from reputable partners.

The early infrastructure model can be applied to other industries, such as agriculture, by forming partnerships with strategic players.

Learnings from the solar and LNG markets provide valuable insights into risk mitigation, project structuring, and standardization.

A startup checklist for early infrastructure projects includes team building, contract finance, tech demonstration, focus on first-of-a-kind projects, pipeline development, strategic interest, and a solid business plan.

Contact Us

Guest: https://www.linkedin.com/in/lekkakis/

Email us: info@climatetech360.com

Host: https://www.linkedin.com/in/samiaqader/