Friends of ClimateHaven –
When your aim is to decarbonize an entire economy, there will be no shortage of gaps to fill. Gaps in technology, policy, funding, and networking.
Yes, I said networking! Let’s fill that gap on August 24 with Green Drinks, the return of a New Haven tradition, and the start of ClimateHaven’s quarterly networking series. Join us at ClimateHaven for an evening of beer, wine, and great conversation with old and new climate friends.
A big thanks to our friends at Forge for sponsoring this event. More on the great work Forge is doing below.
And while I’ve got you thinking about events, mark your calendar for the Yale Clean Energy Conference on November 9th and 10th. We’re excited to serve as host for the first day of the event.
Not all big breakthroughs become big businesses, especially in climate tech. Making the leap from developing scalable climate technology to building an enduring business isn’t easy. It comes with a lot of challenges that are unexpected and a lot of requirements that feel downright foreign.
Let’s see if we can help! We’re taking the multitude of challenges that entrepreneurs will face in building their businesses and tackling them one by one. We started with Financial Controls, Building a Board, and Insurance.
The next three topics will focus on issues that arise when raising capital. We’ll tackle (i) Building the Goldilocks Data Room, (ii) Managing Your Cap Table, and (iii) Stock Options 101.
Are there topics you want to see us cover? Reach out and let us know!
Equally important to climate tech entrepreneurs are the people and organizations who can effectively support them.
The right partners make all the difference in the world to a climate tech startup, especially one taking a novel technology into a heavily regulated market with entrenched incumbents. Forge is a wonderful example.
More often than not, brilliant climate tech entrepreneurs know little about the intricacies of manufacturing a physical product, let alone how you scale manufacturing to generate a predictable positive gross margin. That’s where Forge comes in. They have a talented team that helps startups navigate the incredible challenges of manufacturing a first-of-a-kind product. Talk about filling a gap!
As we write about the business challenges that startups face, we want to fill our community with partners who come with the tenacity and expertise to help entrepreneurs address these challenges.
Who are these partners? We’d love to hear from you – our community of entrepreneurs and climate enthusiasts. What partners are most valuable to a scaling climate tech company?
Side Note No. 1: unpredictable gross margins, even if positive, are a red flag. Figuring out how to generate a positive gross margin that is predictable is really hard and really important to building investor confidence.
Side Note No. 2: I recognize that the most valuable partner to a climate tech startup is the one that comes with a check. If you’re raising capital, follow up with me and my teammates at the ClimateTech Fund.
As we build out the clean power team of electricity generation (think solar, wind, hydro, geothermal and nuclear – yes, I said nuclear), energy storage will be critical in addressing the intermittency associated with solar and wind.
Compelling solutions have already emerged. Lithium-ion batteries are a short-term workhorse (think 4-8 hours). As demand increases, especially in the afternoon, lithium-ion is there to dispatch clean electricity.
On the other spectrum, you’ve got the kick-ass team at Form Energy building a whole new market of 100+ hour storage with iron air batteries. Very valuable for seasonable storage.
But what about the massive gap in the middle? Where is the 24-hour battery that can take us through the night or a rainy day?
If breakthroughs in geothermal and advances in nuclear fission and fusion allow us to truly build out the clean power team, then we have a baseload of clean electricity that is firm and only part of our clean electricity mix that is variable. In that instance, my sense is that the most valuable energy storage product could come from a battery that can reliably, cost-effectively, and routinely (i.e., regular cycling) give us a 24-hour solution.
According to the National Renewable Energy Laboratory, the installed costs of solar systems dropped dramatically from 2010 to 2020:
The decrease of residential solar systems.
The decrease in commercial rooftop systems.
The decrease in utility scale systems.
Three reasons why these three numbers matter. First, reduction in material costs matters, but installed costs matter more because that’s the basis for establishing project financing. Second, those installed costs will vary meaningfully depending upon the commercialization pathway (making the pathway entrepreneurs pick very important). And third, the cheaper variable energy sources get, the easier it becomes to make them firm with energy storage solutions. Call me a fan of utility-scale solar with a 24-hour battery!
An aspiring climate technologist asked me if I had any book recommendations. You’re darn right; I have book recommendations! There’s a longer list here, but I’ll offer three depending on your mood:
1. Speed and Scale by John Doerr – This book is an action-oriented plan (and a fast read!) of the climatetech solutions we’ll need to meaningfully reduce our greenhouse gas emissions.
2. Drawdown by Paul Hawken – If you’re looking for the literal textbook for decarbonizing the planet, this is it. You’ll feel like you’re back in college reading it.
3. The Grid by Gretchen Bakke – This book is an informative and fascinating history of our grid, shining a spotlight on the crazy complexity of America’s energy infrastructure. The best beach read of the three.
As we work to decarbonize our planet, gaps that we could not imagine today in systems, business models, and technologies will undoubtedly emerge. Gaps will turn into opportunities, and these opportunities will keep climate technologists busy for decades to come.
For ClimateHaven, that means we will always hunt for new startups, new team members, and new folks to welcome to our community. Join us on August 24 to learn more!
Until next time,
Ryan
P.S. Follow ClimateHaven on LinkedIn, Twitter, and Instagram to keep up on our progress between newsletters.
