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It's about market size, not startup scale

Alan Neuhauser
Mar 23, 2023
photo illustration of Eli Aheto of BeyondNetZero surrounded by squares overlaid on a photo of a hilly landscape

Photo illustration: Tiffany Herring/Axios; Photo: Courtesy General Atlantic

Founders often prioritize scale. Eli Aheto tells Axios he thinks more about market size — not company size. "A relentless focus on unit economics and disciplined overhead will lead to a profitable business that attracts investors."

Why he matters: Aheto is managing director with BeyondNetZero, the $3.5 billion climate venture fund from private equity giant General Atlantic.

This interview was lightly edited for length.

What, in your view, was the big story in climate tech this week?

  • The IPCC report Monday. Not surprisingly, it highlighted the lack of progress toward the emissions reductions goals aligned with 1.5-degree temperature rise.

What would you add to the narrative?

  • By being slow to deploy technologies that underpin near-term decarbonization, we are subjecting consumers to higher energy costs over the next decade. We are missing climate targets at a cost to consumers that grows every year.
  • The fact that solar, wind and EVs in most markets are cost-competitive should catalyze action to mitigate emissions. The transition from green premiums to lower cost/volatility is the real catalyst for our portfolio companies.

By contrast, what's going under-noticed?

  • Countries are evaluating opportunities to create new industries and employment and reduce dependencies.
  • The IRA gets all the attention given the size of the U.S. market, but other non-EU countries are also creating the legislative support to drive priorities tied to climate.

In three-ish words, what change would you make to climate-tech investing?

  • Time value of money and carbon.

Three fun things

💼 First job: IT support team at Constitution Reinsurance Corp.

👑 Proudest investment: A transmission line between Montana and Alberta that enabled thousands of megawatts of wind. It was sold to a large utility and then to a Berkshire Hathaway portfolio company. So I can say I saw the opportunity about a decade before Warren Buffett! Warren, I have some other ideas for you.

🤦 Facepalm investment: A small personal investment in a friend’s comedy movie project.

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