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We asked climate investors which trends they're in love with — and which they'd love to dump.

Here are their valentines. Special shoutout to Andrew Beebe, who managed to work the word "slippery" into a question about climate tech.

❤️ Geothermal, nuclear, green chemistry, construction materials, water and air purification, and any technology that improves efficiency of data centers.

💔 Any products or services that depend on green premiums or corporate ESG commitments.

❤️ Proven technologies that don't use the atmosphere as an open sewer.

💔 Direct air capture is a fantasy; no amount of enthusiasm can overcome thermodynamics.

❤️ Nothing gets one warmed up quite like geothermal. It's always been the silent and strong type (24/7), but was overlooked (hiding underground while their solar cousin got all the exposure). People are finally respecting the deep love geothermal has to offer.

💔 The rest of the subsurface world: oil and gas. They were a great hot date for decades, but now they're just sort of tired, dirty, and slippery. A little too explosive.

❤️ Technologies that enable home electrification, from non-conventional heating sources to ways to avoid electric panel upgrades.

💔 Inflexible 'smart' metering. We need better data on residential energy use, and many smart metering initiatives have not been successful.

❤️ Climate + AI, specifically ways to speed discovery of new sustainable materials.

💔 Storing captured carbon in the ocean or mining the ocean floor for minerals.

❤️ Entrepreneurs working on adaptation of our physical and financial infrastructure to climate shocks.

💔 VC dollars funding companies surviving on government subsidies to build out EV supply chains.

❤️ Software that makes grids smarter, more robust and resilient; more focus on making the decarbonized grid cheaper and not just greener.

💔 Massive grid interconnection queue-stacking that's meant to gamify an already slow process; hydrogen as a transportation fuel for literally any application.

❤️ Climate companies are getting the capital and resources to scale at the pace required to address our most urgent problems.

💔 Big shifts require big ideas, with equally big risks. Time to exit our "haters era."

❤️ That economic growth is aligned with increased labor demand in the energy sector, resulting in new tools to train a new generation of talent.

💔 The narrative that EVs and solar are in a tailspin — both industries are still among the fastest growing in the world. Also generalist investors that briefly came to climate during the market peak of 2021-22.

Jonathan Winer, Sidewalk Infrastructure Partners

❤️ The increased focus on virtual power plants among investors and policymakers.

💔 Skyrocketing energy consumption by data centers.

❤️ Carbon-free nuclear power substituting coal and natural gas, combined with low-cost batteries for distributed mobile uses substituting gasoline.

💔 I am unsure if all the meat/seafood substitutes are making a significant dent in the climate fight.

❤️ Funding market for climate tech is opening up with lots of interest from general and specialized firms.

💔 The IRA roll-out is slower than what it needs to be.

1 big thing: Your roses and rejections

a pink paper cut illustration of the earth with an arrow going through the center of it 

Land Energy plans to raise $65 million to ramp up its production of electric motorcycles and standalone smart batteries, the startup tells Alan exclusively.

Why it's the BFD: Drivers tend to trade in an EV when its infotainment software starts showing its age or the battery stops holding as much charge.

How it works: Cleveland-based Land Energy wants to extend the lifespan of EVs — and other electronics — by enabling consumers to upgrade both the battery and computer system at the same time.

The startup has integrated a swappable battery with the connectivity and data capabilities you'd find in a smartphone or laptop.

It's selling the batteries as standalone power sources. But the bulk of its business has been the electric motorcycles it's built around those smart battery systems.

What they're saying: "We think of the bikes as the Trojan horse: It gets people hooked on the drug that is mobile energy," says CEO Scott Colosimo, who previously founded a motorcycle shop.

The two-wheeler approach has kept costs low while quickly generating profitable product margins, he says.

"We saw the collapse of the venture market coming — we needed a way to execute our profitability almost immediately."

Catch up quick: Land Energy in November closed a $7 million Series A. 

The latest: It's now raising a $15 million bridge round via convertible note, led by Nunc Coepi Ventures.

Once that round closes, anticipated March 31, Land Energy plans to begin raising a $50 million Series B. It's eyeing a post-money valuation north of $200 million and may blend equity and debt.

What's next: Land Energy plans to ramp up production at its existing facility and is seeking a location to make its standalone energy storage systems.

"We've seen a lot of companies make a product at $8,000 and sell it at $5,000 and say 'we're going to scale into profit,'" Colosimo says. "We're not doing that. We make a product that's driving margin."

2. The BFD: Two-wheel battery bet

Two people ride Land electric motorcycles around a bend of a sunny, forest-lined road.

Land Energy says it's targeting both experienced riders and the EV-curious with its electric motorcycle. Photo: Courtesy of Land Energy

🚘 Chinese EV panic: American automakers see Chinese electric vehicles as an existential threat, colleague Joann Muller writes in What's Next.

Thanks to government subsidies, as well as access to cheaper batteries and labor, China is making attractive, affordable electric cars like the sub $11,000 Seagull EV from BYD.

Chinese electric passenger cars aren't yet sold in America, but the mere threat is whipping U.S. automakers into a frenzy.

💰 Filling the gap left by fossil fuel dollars: States are paying close attention to the looming struggle to replace royalty and tax revenue as oil and gas production declines in the energy transition, Axios Pro's Nick Sobczyk writes in Energy Policy.

"It's a very hard thing to have a really strongly diversified economy in small towns and in isolated rural areas," Wade Buchanan, director of Colorado's Office of Just Transition, told Nick. "It's going to be an imperfect solution, whatever you do."

🎥 Today in semi-clickbait: "Travis Kelce's Debut as a Film Producer Is Also the First Movie Financed Using President Biden's Green Energy Tax Credits."

That's the headline in Variety, which reports that green energy entrepreneur Mike Field sold renewables tax credits to fund production of the movie "My Dead Friend Zoe" — of which NFL star Kelce is an executive producer.

3. Temperature check

Illustration of a pattern of repeating thermometers with different temperature levels.

• Foundry Group, the Boulder-based VC firm with ~$3.5b AUM, is winding down after 18 years of operation, per TC. https://axios.link/3UB8wbN

• Boston-based utility Eversource Energy plans to sell its stake in two offshore wind projects in a $1.1b deal to Global Infrastructure Partners. https://axios.link/3uy9z1q

• Core Industrial Partners raised $685m for the Chicago firm's third fund, and $202m for a fund focused on industrial services companies. https://axios.link/3welC4G

• Private equity firm Inyarek Partners launched to invest $50m-150m in sectors such as low-carbon fuels, distributed power, and the energy transition value chain. https://axios.link/3uvhBbx

• Automotive Cells Company, a European battery cell maker, raised €4.4b in debt financing. https://axios.link/3UzLjGV

• Transom Capital Group agreed to buy the EV charging products unit of Germany's Webasto Group, which will retain a minority stake. https://axios.link/49dqplb

• GeologicAI, a Calgary-based startup that uses AI for mining, has acquired Canada-based Resource Modeling Solutions for an undisclosed amount. https://axios.link/3HXez2X

• Australian solar thermal company Vast, and German clean fuels provider Mabanaft say they've signed funding agreements for A$40m (~$29.5m) from the Australian Renewable Energy Agency and Projektträger Jülich on behalf of the German government to build a solar-powered methanol plant called SM1. https://axios.link/3OIgiNe

• Eden, a Sommerville, Mass.-based startup that uses electricity to stimulate underground reservoirs, has been awarded a $1.4m grant from ARPA-E for two projects to stimulate geologic hydrogen. https://axios.link/4bAdwDw

5. Hot deals

• Robert Pease was appointed to the board of Phillips 66. Pease has been an executive at Shell Trading, Motiva Enterprises and Cenovus Energy. https://axios.link/49tPyYA

• David Hanson has been promoted to CEO at Flibe Energy. Hanson was previously the COO. https://axios.link/42DFRVj

• Alicia Forry was promoted to head of ESG for alternative investments for Investec. Forry was previously the consumer analyst and head of UK Equity ESG Product. https://axios.link/3OIY4ei

• Peter Sherk has joined the board of New York-based solar provider Aspen Power. Sherk is currently on the board of Wabash Valley Resources and was previously CEO Americas for Mercuria Energy Trading. https://axios.link/42Eq5cN

• Alex Graham has left Rothschild & Co., where led the firm's Canada office, per Bloomberg. https://axios.link/49tqXmI

• David Kim joined 8VC as a senior adviser. Kim was previously head of IR for Apax Partners. https://axios.link/49AgQwM

• Donald Mackenzie is stepping down as co-chair of CVC Capital Partners, the London-based buyout firm he co-founded, ahead of its planned IPO. https://axios.link/48hSPJL

6. It's personnel

Roses are red, violets are blue, venture markets are open again, and hopefully IPOs, too.

Credit to Rick Zullo of Equal Ventures, who was moved to poetry (prose?) with his Valentine's Day submission. 

Joey Barrick, of SJF Ventures, riffed on a similar theme. "Fires are red, floods are blue, climate resilience is needed and adaptation, too."

Trust us when we say we'll keep these locked away. At least until next year. Thank you for your valentines, see you tomorrow!

7. Poetry of the day

Happy Valentine's Day! Thank you for saying "Be Mine" to Climate Deals.

🎵 Katie is going to see folk rocker and former neighbor Chuck Prophet for Valentine's date night.

😑 The "n" key abruptly stopped working on Alan's MacBook. He's spent the past two hours filling it in with ctrl+v. 

Thank you to Michael Flaherty, Claire Rychlewski and Chris Speckhard for today's edits.

And thank you for reading Climate Deals! Please share with your friends, family and valentines.

February 14, 2024

1 big thing: Your roses and rejections