Key Takeaways
The risks of climate change are becoming increasingly clear, and the appetite for technological solutions continues to grow. As a result, the innovators leading the way to a net-zero future have the wind at their backs even amid a decline in overall venture capital investment. Our latest report explores the opportunities available in this optimistic but complex landscape. Here are three takeaways:
$11B In US VC fundraising closed in the last 4 quarters
Climate tech VC fundraising has held up well, settling at a historically high level.
14% Decline in deal activity since 2021
Compared to the 24% decline in overall US VC deal activity, climate tech remains resilient.
60% Of climate tech companies with less than 12 months of cash runway
Cash continued to fall for climate tech startups in 2023.
Investment outpaces VC ecosystem
While overall US VC investment has seen the most substantial correction since the dot-com bubble, VC deal activity in climate has remained relatively steady.
This resilience is supported by government incentives, increasing awareness of climate risk and long-term technology trends that are reducing the cost of renewable energy.
Sources: SVB proprietary taxonomy, Cleantech Group, PitchBook Data, Inc. and SVB analysis.
Climate tech companies see declines in cash runway
60% of climate tech companies have less than 12 months of cash runway. That compares to 53% of all tech companies.
Because climate tech companies tend to address more difficult technological challenges, they tend to be more capital-intensive than their peers. The resulting decline in runway may create a favorable funding environment for investors in 2024.
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