Major VCs link arms in new climate push
Big names in the venture capital world are launching a first-of-its-kind group to ensure startups begin life on a climate-friendly pathway — and stay that way as they scale, Ben writes.
Driving the news: The new Venture Climate Alliance is designed to align firms' portfolios with a "net zero" emissions future, and help individual companies they finance do the same.
- The group's membership already includes roughly two dozen VC firms in the U.S. and Europe.
- Among them: Prelude Ventures, Capricorn Investment Group, DCVC, Energy Impact Partners, Fifth Wall, and S2G Ventures, to name a few.
Why it matters: It fills a void. Existing efforts bring large companies and industries — banks, for instance — together around "net zero" goals and charting their progress.
- But small, venture-backed companies eventually become big ones. The collective impact of products, services and tech they provide other industries will matter a lot.
How it works: The VCA will help provide venture firms and their portfolio companies with methods and resources to analyze and report not only their own emissions, but climate impact more broadly.
- The group is a project of Rockefeller Philanthropy Advisors.
The big picture: Prelude Ventures principal Alexandra Harbour said the goal is to "bridge the gap" between startups and climate targets already common among large public companies.
- Early stage innovation "has the potential to decarbonize legacy industries through a combination of better products, more efficient processes, and lower costs," said Harbour, the VCA chair and co-founder, in a statement.
What they're saying: Daniel Firger of Great Circle Capital Advisors, notes big Fortune 500 companies have plenty of staff and money to analyze their climate effects and hire consultants.
- "Startups don't have that luxury. Budgets are tight. Bandwidth is really constrained," Firger, who is advising the new group that he helped launch, tells Axios.
- "So providing ... support for those portfolio companies and founders is very much of a vision for what the VCA will help members to do."
The bottom line: "Venture [capital] has a lot to contribute to the conversation," Harbour tells Axios.
- "And we have a fiduciary duty to our LPs and to our portfolio companies to prepare them for exiting into a market environment in 2030, 2040, 2050 that looks fundamentally different than it does today."