Future Forward: Investing in Net Zero Roundup
With COP26 just around the corner one of the biggest topics of discussion around the investing world is net zero. A commonly agreed target by world leaders and businesses to negate the greenhouse gasses produced by human activity, it drives the public consciousness and has inspired a huge number of entrepreneurs to look at how they can help to achieve that target. With reports that reaching net zero will cost between $1 trillion – $2 trillion a year of additional investments UKBAA in partnership with SetSquared and CMS came together with a number of leaders in the early-stage investment ecosystem to look at where these opportunities lie. Take a look at our roundup of each of the sessions:
The day began with a brief introduction to the day by our Managing Director Roderick Beer, followed by our keynote interview where our esteemed CEO Jenny Tooth interviewed Dr. Rhian-Mari Thomas OBE, the Chief Exectuvie of Green Finance Institute.
Rhian-Mari provided an excellent summary of the most recent studies on climate change and shared the major predictions on the next decade, “the average global temperature has already increased by 1.1C since 1880, 5,000 times faster than the most natural rapid natural warming episode in the planet’s past”. She highlighted that such a wide reaching challenge required a similarly wide reaching response from all kinds of businesses and focused on the VCs and angel investors’ opportunities to drive this at the early stages. Ultimately, three broad points were drawn out. The first focused on recognising that systemic climate change is a threat that threatens the entire economy and not a threat that you can diversify your portfolio to avoid. The second was that investors’ agency as financiers gave them a unique position in which they could use their experience and expertise to inform policy making at all levels, “to help create the innovative financial mechanisms, the funds that blend public and private finance, upskilling the entrepreneurs and environmentalists who have the creative vision to address the challenges so they can better understand how to make their proposals investable“. The third point was understanding the criticality of emerging market mechanisms and the role of the UK to act as a pathfinder, helping to trial policies, regulations, philanthropic government interventions and more to find the best ways towards decarbonisation which could be exported to other countries in turn.
Our first speaker, Dr. Rhian-Mari Thomas OBE
Following the interview our panel of corporate VCs Oliver Finch, partner at Maersk Growth; Jamie Rowles, head of investments at Sky Ocean Ventures; and Jonathan Tudor, investment partner at Clean Growth Fund moderated by Anthony Waller, CMS provided us with some direct experiences relating to how they were connecting with early stage innovators and investors to find climate solutions.
Key points raised were the importance in reducing the frictions faced on a personal and corporate level and the importance of forward market demand signals to help drive this forward. So too was the supply/demand factor and how much the market could actually shift without demand to drive it. Beyond challenges encountered they discussed some positive solutions including new services, products and activities they had implemented to meet the challenges the climate change issue had created.
Next up was David Richardson, Head of Innovation at OFGEMS’ brand new strategic innovation fund. He provided us with an overview of the £450m fund designed to unlock greener ways to travel and to hear and power homes and businesses with the intention of turning the UK into the ‘Silicon Valley’ of energy.
David explained that the goal of their fund is to minimise the cost of introducing renewable energy by looking at the cost of infrastructure for retail and consumers. A key method of achieving this is analysing and finding ways to restructure the energy market to help incentivise key aspects like locational pricing, getting people to use energy for different purposes at the right times, better storage assets and more.
David then provided details on the three phases of the fund, covering the initial assessment of a problem and its proposed solutions, the discovery and feasibility stage where prototypes are developed and rested and the big final phase looking at real world demonstration of the solutions in play.
A highlight for many on the day was our quickfire pitching event where we heard from 5 carefully selected businesses in the climate tech space. We’ve listed them and a short summary of their services below. We were fortunate for it to be hosted by Rosie Bennett, Investment Manager at SetSquared.
Eco-shaper: Cloud based SaaS tracking carbon reduction goals and actions for large enterprises, employees and suppliers. Find out more about eco-shaper.
Naturbeads: Producers of biodegradable cellulose microparticles to replace plastic microbeads. Find out more about naturbeads.
Phase Biolabs: Decarbonising heavy industry by converting waste CO2 into valuable, renewable chemicals. Find out more about Phase Biolabs.
Shwap: The world’s first circular fashion marketplace. Find out more about Shwap.
Verv: AI company on a mission o reduce energy wastage in the air conditioning and heat pump sector while providing a predictive maintenance solution. Find out more about Verv.
The final panel discussion focused on the Key UK Tech Clusters tackling climate change. Our panel consisted of Paul Jordan, head of business development at Energy Systems Catapult; Professor Jacqui Murray, deputy director of Faraday Battery Challenge; Saffron Myhill the innovation funding manager of Low Carbon Innovation Fund; Colin Stakem, Innovation Manager at SetSquared and Josh Denne, Head of SME programmes at the Advanced Propulsion Centre. Our host was our CEO Jenny Tooth who led the discussion shining a spotlight on some of the key climate innovation clusters in the UK that are so essential for accelerating the production of low carbon and climate-resilient innovations.
Major factors in the development of infrastructure solutions were greater democratisation, new service models and more. Of equal importance was the need to develop better methods of engagement that addressed the required changes to the regulatory environment and the general challenges in finding the investment needed to fuel the start ups that were attempting to solve these climate based problems. An important point raised was the UK’s regional disparity in investment, a topic close to UKBAA’s heart, where many entrepreneurs and investors were travelling to London to seek investment and dealflow but in the process were missing out on great local opportunities. The panel painted a picture of a cohesive environment that has the right ingredients to build a better picture of the changing face of environmentally friendly services and products for consumers.
The final event of the day was an invite only roundtable discussion focusing on the investment opportunities in net zero. Although not publicly available to watch, the discussion got under the skin of the obstacles and solutions towards new services, products and technologies that are more environmentally friendly.
The goal of net zero is a difficult challenge to meet for the UK and the world, but the growing pressures of climate change are making it more important than ever that we meet that challenge. Future Forward heard from experts across a wide variety of businesses and backgrounds, all providing fascinating insights into how that challenge is met. A number of common threads came up as the day went on, in particular the need for new approaches to energy infrastructure including smart methods of energy distribution, new service models and the importance of risk reduction when investing in the innovative and groundbreaking businesses that are leading the fight against climate change.
If you already have a ticket purchased you can log in to the website and view the recordings but if you weren’t one of the 184 attendees and missed the event as it aired live, you can use the code FUTUREFORWARD to create a free user account here.
If you have any questions about the topics discussed please don’t hesitate to get in touch with us at enquiries@ukbaa.org.uk for further information.
