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Angels are keeping VC investment alive in climate tech

Alan Neuhauser
Animated illustration of a hand holding a stick poking at a market trend arrow on the ground.
Illustration: Aïda Amer/Axios

Angels and other early-stage investors are still pouring money into climate tech, even as later-stage fundraising rounds have sagged, per data from Pitchbook.

Why it matters: The flow of money into the sector's newbies comes as later-stage fundraising rounds have sagged amid the stiff market headwinds and overall funding slowdown, as Axios previously reported.

What's happening: Angel and seed rounds for climate tech accounted for $283.3 million raised in Q1.

  • That's more than 40% of all the early-stage money raised in climate tech in all of 2021.
  • Accelerators are among the most active early-stage investors, Axios previously reported.

Yes, but: Russia didn't invade Ukraine until February 24. The Commerce Department didn't accept Auxin's anti-circumvention petition until March 25.

  • In short: Expect to see a decline in climate-tech investment data for Q2.

Yes, and: "In the long term, the attack on Ukraine and resulting calls for energy independence in Europe are likely to accelerate climate tech investment," Pitchbook says.

What they're watching: Increased investment in hydrogen, as well as solar, wind and nuclear.

  • Intense interest in the battery supply chain, from metals and minerals exploration to mining, refining and manufacturing.
  • And a ramp-up in the buildings sector, such as low-carbon cement, HVAC innovations and efficiency measures.
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