6 Climatetech Trends That Grabbed Eyeballs in 2023 Experts feel that we have witnessed a remarkable surge in climatetech startups this year, which will play an imperative role in achieving the net-zero emissions target by 2070
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Climate change is no longer a topic restricted to air-conditioned rooms. It has traversed beyond the four walls of global forums and reached every nook and corner of the world. From student volunteers to corporates, there is an increased realization today that the issue needs to be addressed before it's too late.
Playing a huge role in this transformation are India's climatetech startups, who are expected to increase the sustainability index around the world. India has more than 50 funded startups in the space and some of the categories that these startups operate in include battery recycling, developing sustainable materials, air filter manufacturers, green mobility, allied EV industries, biofuel suppliers, easy emission control devices, solar and wind projects, rooftop solar experts, green energy solution providers, among others.
Some of the key players in the space include Lohum, BluSmart, SUN Mobilitiy, ReNew Power, MYSUN, Nepra, Zunroof, Gegadyne Energy, Attero Recycling, Log9 Materials, ION Energy, SenseHawk, GPS Renewables, among others.
Here are some trends we saw this year in the climatetech space.
Influx of talent
According to experts, in 2023, the most significant game-changer in the climatetech industry in India was the influx of top talent into the sector. "The trend was not just confined to engineers and scientists but also included professionals from finance, management, policy, and design, all drawn to climate-tech's innovative and impactful nature. Diversity of skills and perspectives injected fresh ideas into the sector, fostering an environment ripe for breakthrough innovation. This amalgamation of talent accelerated advancements in critical areas such as battery chemistry and storage, renewable energy systems, plastic circularity, waste management and sustainable agriculture," said Sandiip Bhammer, founder and co-managing partner, Green Frontier Capital.
He also feels that the impact of this fresh talent migration was profound this year. Startups and established companies saw accelerated innovation cycles, leading to quicker deployment of technologies. "Collaboration across disciplines led to holistic solutions, combining technology with sustainable practices, policy influence, and educational initiatives, creating a multi-faceted approach to climate challenges," he added.
Rise of climate-focused funds
We have seen the rise of many climatetech-focussed funds in India in recent times. Climate Angels, Transition VC and Green Frontier Capital are some examples. These funds are focused on investing in startups delivering breakthrough innovation in fields such as mobility, agritech, biofuels, waste management, and clean water, among others. "Green hydrogen in India offers an attractive investment opportunity due to its alignment with the nation's sustainability goals. Despite being unexplored, its potential to revolutionize energy sectors like transportation and industry fuels our interest," said Sandiip Bhammer, founder and co-managing partner, Green Frontier Capital, in an earlier interview. The VC is actively looking at investing in green hydrogen startups.
Commitment from the government
With the evolution of the climatetech sector in India, we also observe the implementation of stricter regulations by the government. Experts say that this signals a commitment to addressing climate challenges. "This year's landscape reflects a dynamic synergy between regulatory reinforcement, increased financial support, and private sector participation, propelling Climate-Tech towards impactful and transformative endeavors," said Rahul Rajani, Investment professional at Blacksoil Capital.
Importance to agritech
India is a hotbed of innovations at the crossroads of climate tech and agriculture. "Agriculture is simultaneously a key contributor and victim of climate change. Therefore, this sector is ripe for human-centric innovations that facilitate climate-friendly crop production, ensure global nutrition security, optimize supply chains, enhance rural prosperity and strengthen rural livelihoods," said Abhilash Sethi, Investment Director, Omnivore, a firm that backs startups in agri and climate.
Entry of experienced leaders
"The entry of experienced leaders and entrepreneurs from well-established industries brought in critical thinking, robust business models, and scalability strategies, all of which are vital for the commercial success of any climatetech venture.
Significantly, the trend also reflected a broader cultural shift. The promise of working in climate-tech resonated with the values of a new generation of workers seeking purpose-driven careers," said Bhammer.
For a long time, electric vehicle (EV) was considered the only solution to climate woes. Today, along with promoting EVs, there is a lot of interest shown by investors and policymakers towards startups in other segments within climatetech such as recycling, solar rooftop startups, green financing, climate-focused deeptech startups, focused on climatetech, among others.
Overall, this year we have witnessed a remarkable surge in India's climate-tech startups, which will play an imperative role in achieving the government's net-zero emissions target by 2070. "Despite ample funding and even with government loans and subsidies, there is a need for more financial support for climate and clean-tech initiatives, across stages. This underscores the crucial role venture ecosystem must play in bridging the funding gap for sustained growth in the climate tech sector to achieve the government's net-zero goal," summed up Rajani.
"India's has a complex path to sustainability, with the need to balance development goals with climate action. We would need to find low carbon and climate resilient pathways to development. Innovative and novel technologies will play a critical role in enabling this necessary balance between people, profits and planet," said Shruti Srivastava, Investment Director, Avaana Capital.