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BFD Expert Voices - Climate Deals

BFD Expert Voices

Angels and other early-stage investors are still pouring money into climate tech, 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 Megan 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, Megan 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.

1 big thing: Angels are keeping VC investment alive

Illustration of a flying calculator with wings, multiple $ signs are displayed on the screen.

The startup Terra.do raised a $5 million seed round for its jobs board and professional development courses, our Generate colleague Andrew Freedman has learned.

Why it's the BFD: Climate tech may be attracting billions of dollars in investment, but careers in the sector are still relatively new.

The details: Avaana Capital led the funding round.

The Telus Pollinator Fund for Good, Precursor, City Light and Avesta also participated.

Individual investors included Albert Wenger, managing partner at Union Square Ventures, and David Helgason, founder  of Unity.   

What's happening: Terra.do says it wants to get 100 million people working in climate by 2030. 

It's launching an app today to connect climate professionals with hiring managers at top climate-tech companies. 

Companies it's working with: Pachama, Aurora Solar, Chewie Labs, Arcadia, Afresh, Kairos Aerospace, plus others.

"The world doesn’t have enough carbon accountants, battery engineers, regenerative farmers, climate risk analysts, policymakers that understand climate," CEO Anshuman Bapna tells Axios.

2. The BFD: Climate-jobs board raises $5M

Illustration of hand holding a stopwatch with a globe on the face

Image credit Data: Yahoo Finance; Chart: Simran Parwani/Axios

Megan was the first to report this month that EV startup Electric Last Mile Solutions was almost out of money. Now it's official: The SPAC-backed company has filed for Chapter 7 bankruptcy protection.  

Why it matters: The company once had a valuation of $1.4 billion. Its swift demise is yet the latest sign that SPAC investors face a rough road ahead.

What's happening: Electric Last Mile Solutions issued a statement late Sunday night that it plans to liquidate.

The company in March disclosed that it was facing an SEC investigation — in turn causing its stock price to drop by nearly half. 

CEO Jim Taylor and founder Jason Luo resigned the month before following an internal investigation.

Those developments "made it extremely challenging to secure a new auditor and attract additional funding," the Michigan-based company said in its statement.

Zoom out: EV maker Canoo, another SPAC cautionary tale, told investors in May there was "substantial doubt" about the company's ability to continue as a "going concern," Megan wrote this month.

Lordstown Motors, one of the first EV companies to go public via SPAC, issued a going concern warning to investors on its most recent earnings call.

Other former SPAC-ers like Nikola have faced setbacks such as lawsuits and executive departures in addition to tanking share prices as challenges mount against the industry as a whole.

Meanwhile: Polestar, a Volvo spinoff, last month saw the SEC approve its SPAC merger with Gores Guggenheim. 

The EV company will trade on Nasdaq under ticker PSNY.

Gores Guggenheim's stock price has sagged slightly since the SPAC was announced last fall.

3. SPAC-backed EV startup files for bankruptcy

Data: Harvard Law School Forum on Corporate Governance; Chart: Thomas Oide/Axios Visuals

Shareholders are pushing back on ESG proposals they see as too prescriptive or aggressive, our Retail Deals colleague Richard Collings reports.

Why it matters: The backlash has unleashed a record number of anti-ESG shareholder proposals — signaling the fight in boardrooms has reached a new phase. 

What's happening: Shareholders have submitted 924 ESG proposals so far.

That's up from 837 such proposals in 2021, and 754 in 2020, according to Harvard data analyzed by the consulting service Georgeson.

The intrigue: 52 of those proposals were "anti-" or "conservative" ESG measures. 

That's just over 5% of the total so far this year. 

👀 What we're watching: It's not just environmental proposals that are facing stiff ESG headwinds.

Social-oriented proposals have seen their approval rate halved, from 18% last year to just 9% so far this year.

Meanwhile: ESG proposals overall are passing at a lower rate — 20% so far, down from 35% last year. 

4. ESG backlash is hitting the boardroom

Phoenix Motor (Nasdaq: PEV), a manufacturer of electric drive systems and light- and medium-duty EVs, closed its IPO with aggregate gross proceeds of $15.75m.

For an EV startup, that’s a drop in the bucket.

Uranium Energy (NYSE: UEC) has agreed to acquire UEX Corporation (TSX: UEX) in a C$234m (~$182m) all-stock deal. http://axios.link/qAIy 

Chevron (NYSE: CVX) has completed its reported $3.15b acquisition of Renewable Energy Group (Nasdaq: REGI) following approval by REG stockholders. http://axios.link/PkUZ 

NaaS Technology (Nasdaq: NAAS), an EV charging service provider in China, has completed the merger between its predecessor, RISE Education Cayman, and Dada Auto. http://axios.link/HG17 

Naftogaz of Ukraine has agreed to buy LNG and green liquid hydrogen from Canadian energy developer Symbio Infrastructure. http://axios.link/HFM1 

Ampaire, an electric aircraft developer, and Black & Veatch have signed an MOU to collaborate on developing airport electrification for electric aircraft. http://axios.link/Jrsx 

Augwind and Voith Hydro have agreed to collaborate on the development of turbines, water pumps and power systems for Augwind’s compressed-air energy storage system. http://axios.link/Nty4 

5. Hot deals

The White House Climate Policy Office has named Trisha Miller as senior director for industrial emissions. Miller was previously a senior director at Breakthrough Energy and part of the Biden transition’s Energy Department review team.  http://axios.link/P0cz

RWE AG has appointed Andrew Flanagan as COO of RWE Renewables Americas. Flanagan was previously senior vice president, chief development officer, at Leeward Renewable Energy. http://axios.link/VdzR 

Voltus, a DER software provider, has named J.B. Lowe as vice president and head of investor relations. Lowe was previously head of U.S. Renewable Energy Equity Research at Citigroup. http://axios.link/fz8Q 

APsystems, a solar equipment manufacturer, has named Daniel Burke as country director for its U.S. business unit. Burke joins the company from Dalkia US, EDF Group, where he was vice president of distributed generation sales and marketing. http://axios.link/IwsN 

Ygrene, a property-improvement financing company for renewables, energy efficiency and other upgrades, has promoted Supriya Sachar to COO. http://axios.link/OK93 

Aris Water Solutions announced today that CFO Brenda Schroer will depart the company in the second half of this year once a successor is named. http://axios.link/8zEt 

6. It's personnel

📝 Situational awareness: The CEOs of Ford, GM, Stellantis and Toyota NA have sent a letter to Congress, calling on lawmakers to lift the per-automaker cap on the $7,500 EV tax credit.

🍻 Megan is back in action after a weeklong tour of Bavaria's best breweries and hiking trails. It's a short-lived break from airports, however — she'll be at TechCrunch Sessions in Berkeley tomorrow. 

🕶️ It's been 48 hours and Alan's brain is still on fire from "Top Gun: Maverick." Ridiculous? Yes. Predictable? Absolutely. Score: 10 out of 10. 

Thanks for reading Climate Deals! Please share with your friends, family, funders and WSO.

June 13, 2022

1 big thing: Angels are keeping VC investment alive