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What SOSV’s Local weather Tech 100 tells founders about traders within the house

On Earth Day, April 22, SOSV printed the SOSV Climate Tech 100, an inventory of the perfect startups that we’ve supported from their earliest phases to deal with local weather change. There are all the time useful insights embedded in an inventory just like the 100. A TechCrunch story captured the funding perspective, and an SOSV post went deeper into the businesses’ class breakdown and founder profiles.

However what can founders be taught from the record about local weather tech traders? In different phrases, who invested within the Local weather Tech 100? We dug into the “who’s who” of the record, which had greater than 500 traders, and right here’s what we discovered.

An lively however fragmented panorama

For those who suppose 500 traders in 100 corporations is a whole lot of traders, you’re proper. There are clearly a whole lot of traders considering local weather tech, and most are generalists simply testing the waters. For the Local weather Tech 100, about 10% of traders put their cash in a couple of startup and solely seven (lower than 2%) wrote a test to 4 or extra. These included Blue Horizon, CPT Capital, EF, Fifty Years, Hemisphere Ventures and Horizons Ventures.

That sample tracks nicely with knowledge from PwC, which discovered that 2,700 distinctive traders had backed 1,200 startups in its State of Climate Tech 2020 report masking the 2013-2019 interval. The report discovered that solely 10 corporations out of two,700 made 4 or extra local weather tech offers per 12 months, on common, over the 2013-2019 interval. Essentially the most lively corporations are listed within the desk beneath.

Picture Credit: PwC, 2020; extra analysis by SOSV

Capital deployed in local weather tech grew at 5 occasions the enterprise capital general development fee over the 2013-2019 interval.

There’s motive to consider that the fragmentation will diminish with the launch of extra funds centered on local weather tech. 4 funds value greater than a billion {dollars} every have launched since 2020 that match the outline (see chart beneath).

It’s additionally encouraging to see that capital deployed in local weather tech grew at five times the enterprise capital general development fee over the 2013-2019 interval.

Even so, local weather tech nonetheless solely represented 6% of whole enterprise capital deployed in 2019, so there’s loads of room to develop.