On this week’s Exponential View podcast, I speak to Dawn Lippert, founder and CEO of non-profit climate tech incubator Elemental Excelerator.

Dawn works to speed up the commercialisation of companies fighting climate change, funding them to implement projects, test their viability, and scale up. Elemental Excelerator has 136 portfolio companies, and has funded 81 demonstration projects. It has awarded $49m to companies to date.

Last month, Elemental spun out a $60m venture-capital fund to speed the progress of climate tech companies, while providing access to a rapidly-growing space for investors.

The big idea

Climate tech investment has picked up considerably since the early 2010s, following the bust of the cleantech craze. According to PitchBook, climate tech investors have closed as many climate-focused funds in 2021 as in the previous five years combined; and interestingly, late-stage investing is surging.

When it comes to money from governments and univesities, grants can be a valuable way to provide R&D support and provide gap funding in the seed stage, but they don’t always have a clear path to profitability.

Elemental Excelerator's model combines on-the-ground community knowledge and technological innovation with policymaking smarts, giving early-stage climate tech companies a better chance of success. Dawn and her team work where the rubber hits the road:

That's what makes us different from other investors. We fund first-of-their-kind projects in real communities, and then we have those proof points to work with policymakers and say, these are some things that are working. And here's what that might mean for permitting. Here's what it might mean for building codes. Here's what it might mean for regulations…

The breadth of projects which are growing under Elemental's vision is astonishing. Dawn and her team have invested in companies building electric planes (Ampaire),  energy IoT systems (Blue Pillar), land restoration (TerViva), among others.

Along with the role of local communities, Elemental places heavy emphasis on diversity:

At Elemental, 60% of the founders of the companies are women or from traditionally excluded groups [...] we specifically are looking for founders that may have been overlooked and may have amazing ideas and work that's really responsive to what's needed in their communities that might otherwise not have access to traditional networks and capital.

Talent is following

It's not just the capital that's on the rise. We discussed a steady flow of talent from software coming into climate tech. Dawn sees it regularly:

Every single week, almost every single day, I probably get a note from someone leaving Netflix, Google, Facebook and wanting to bring their talent and their expertise to climate. [...] They've had a good ten to twenty years at some of these tech companies and have done pretty well financially. And now they're having kids, looking around and smelling wildfire smoke, and realising that they want to do something different with the next twenty years of their life.

Multigenerational interest to get engaged in the field is what can give us all optimism and hope:

[A]ny founder story, any day of the week gives you incredible reason for optimism and hope. There's so many people, I would say anywhere from a founder to the youth activists that we work with, to the 1385 interns we had apply for ninety spots across Elemental in our portfolio companies this year. Huge amount of interest among youth people who are not waiting to get their degrees to make a contribution to climate change, but are doing it right now.

Dawn and I also discuss:

✈️ What it takes to get the world’s first hybrid-electric commercial flight off the ground [11.41]

🕴️ How a maturing climate tech market could create a founder ‘mafia’ [14.57]

📈 Why climate impact investing is about more than reducing greenhouse gases [18.12]

Further Resources:

Listen to the episode here, transcript is available.

The State of Climate Tech 2020 (PwC)

Elemental Excelerator’s Portfolio (Elemental Excelerator)