FUTURE IMPROVED / A call to action for the next decade!
2023 has been an important year for IMPROVED as we marked our 10th anniversary in September.
A celebration of our first decade filled with partnerships, entrepreneurship, and game-changing innovation in the technology, energy, and mobility sectors.
But more importantly, it is an excellent opportunity to look forward to the next decade of innovation. Under the mission “Future IMPROVED,” we hosted a year-long initiative to connect key players in the global climate tech ecosystem and collectively accelerate efforts to make a positive impact through responsible entrepreneurship, investment, and development.
Concluding this impactful initiative, our collective goal remains: We need to promote global innovation ecosystems, accelerate collaboration between the public and private sectors, and establish standardized metrics for impact measurement. We must scale impactful technologies and business models together, ensuring support through partnerships, investments, or ownership transitions. The next decade hinges on our unified efforts, leveraging bright minds and cutting-edge technologies to turn today’s challenges into tomorrow’s opportunities.
Read on to explore the bold but much-needed goals and calls to action from our Managing Director Sherief Rahim, joined by some of our closest friends and partners: Clare Murray, Natasha Fowlie, Ryan Fisher, Rene Savelsberg, Ade Thomas, and Federico Cristoforoni.
Sherief Rahim, Managing Director at IMPROVED
In September of this year, IMPROVED celebrated its 10th anniversary year. We had the pleasure of hosting over 200 entrepreneurs, investors, policymakers, and corporate decision-makers from across the globe in Amsterdam.
Next to celebrating our anniversary, we reflected on the challenges and opportunities of investments and M&A in the Climate Tech space. The call to action that was highlighted by our speakers from the Economist, BNEF, Prof. Bruce Usher and our panel of climate tech investors was clear: rapid and sustained investments that reduce greenhouse gas emissions are imperative to avoid catastrophic consequences and represent a multi-trillion investment opportunity in the decades ahead.
At IMPROVED, we specialize in the Technology, Energy and Mobility sectors, and we could not be more excited about continuing to work with entrepreneurs, investors and corporates to build the market leaders of tomorrow. Over the past ten years, we have advised and supported market leading founders, investors and corporates on growth capital and M&A in the green transformation.
This past year has seen a market correction from 2021 across all growth sectors, including Climate Tech, where investors are refocusing on solid fundamentals. Although Climate Tech attracted most of all growth funding in Europe and North America, we are at a pivotal stage. For those who can adapt by getting their strategic priorities and funding in order, value-creation opportunities will continue to exist.
We foresee that category leaders in Climate Tech will deliver returns that emulate the leaders in the technology market, and we believe Climate Tech possesses all the essential ingredients for this continued revolution:
- A robust and deep investor network across all asset classes
- Broad strategic exit opportunities to offer liquidity to shareholders
- Technology breakthroughs that lower the costs of green technologies like batteries and renewables at scale
- Successful asset-heavy infrastructure businesses with high barriers to entry and predictable revenues
- Consistent and all-time high government support
- An accelerating talent migration to climate tech companies
We firmly believe that the sector is now poised for the next wave of entrepreneurship and market maturity. We have seen first-hand how innovation in Climate Tech has been a driver for disruption, economically viable businesses, and accelerating the pace of change across sectors. Our firm belief is that strong entrepreneurship in Climate Tech will impact any industry, and successful transformational M&A transactions involve deals with winners only.
We look forward to the next decade of continuous innovation in Climate Tech, both in our existing verticals such as EV Charging, (E-)Mobility, Energy Software, Sustainable Infrastructure, Grid Optimization, Logistics, Renewables and Storage but also in new and unknown segments yet to be defined.
We look forward to making the next ten years the most advanced and impactful ones yet. Thank you for being part of this journey towards 2033.
Clare Murray, Co-Founding Partner at Blume Equity
Going into 2024, we at Blume are focused on supporting high-growth companies that have reached the scale-up phase. Much capital is focused on climate-tech investing at the venture stage, and we now see many high-quality companies that have found their product market fit and need to scale in order to become sustainable businesses and global winners. Numerous policy reports have highlighted the significant lack of capital at the scaleup stage across Europe and the UK (estimated at c. £5-10bn per annum in the UK alone).
That’s where Blume comes in with both capital and expertise, supporting companies tackling climate change, particularly related to the energy transition. A few areas of focus – but not limited to – for Blume in 2024 include climate risk solutions, given regulation driving traceability, biodiversity and the need for extreme events protection, precision agriculture, given climate change and resource pressure, and green heating through retrofit, heat pumps, software/ IoT services and heat networks.
Given Europe has yet to announce a policy as ambitious as the US’ Inflation Reduction Act, which mobilises $370 billion to support the US’ green transition, massive amounts of private capital need to step up to support these European companies. Impact investing is a corner of finance with significant collaboration, and we welcome this –partnering both with earlier stage funds as the next funding partner, as well as aligned investors to join us in supporting climate-tech companies on this next scale-up phase of the journey.
Natasha Fowlie, Principal at General Atlantic | BeyondNetZero
Addressing global climate change requires a systemic transformation at a pace and scale never seen before. A massive expansion of investment in the energy transition is essential to reach net zero, a trajectory requiring an annual investment of $3.5T across all sectors, about 3-4x current levels.
Commercial efforts to reach net zero need to address the whole market, requiring a coordinated effort between governments and the private sector – the latter of which could provide 70% of the financing required. 80% of the technologies we need to reach net zero by 2050 have already been developed – but only a fraction are currently commercially available. The challenge for the entire investment ecosystem is connecting capital to scalable solutions, ultimately driving down costs to increase adoption.
One thesis central to our investment activity is ‘electrify everything and decarbonize the grid’. As we see the electrification of mobility tip over from early adopters to the mass market, we are focusing on bottlenecks in the value chain where our capital can unlock customer pain points, and drive increased capacity and utilisation.
At the same time, this drives significant incremental demand onto the grid – just as we are trying to move away from centralized, fossil fuel-based generation to a distributed system based on intermittent renewable sources. So, we are also looking for solutions to improve and optimize the grid, which also requires investment across the value chain, from infrastructure and hardware to software and services.
Over the next decade, investing to balance the dual objectives of electrification and grid decarbonization will be key to supporting systemic transition across global energy systems.
Ryan Fisher, Head of Charging Infrastructure at BloombergNEF
Electric vehicle charging operators will be among the largest consumers of electricity in the world by 2030. The public charging network in China is already set to consume 35 terawatt-hours (TWh) of electricity in 2023. That is more than Ireland. Tgood, the biggest public charging operator in China, consumed 6TWh in 2022 and is chasing down the biggest companies, including Amazon, which consumed 38.7TWh in 2022.
The growth in demand for charging will make operators more important customers for utilities and drive renewable energy deployment. To meet the expectations of their green-conscious customers, companies will purchase green energy through renewable energy certificates or, increasingly, through power-purchase agreements with renewable energy developers.
Power-purchase agreements have financial benefits as they provide a hedge on future electricity costs. They also increase the value of carbon credits for operators as they show they are providing lower-emission electricity. These credits account for around 10% of revenue for public charging operators today, making the business case of charging more attractive. Governments across Europe and North America have committed to rolling out more carbon credit plans that will draw billions of dollars to the charging sector.
BloombergNEF will continue to provide in-depth research on the growth of the charging sector, providing transparency for companies looking to capitalize on the opportunity it represents. We will continue to analyze the economics, the alignment with renewable energy deployment, power-purchase agreements and the roll-out of carbon-credit plans.
Check out this recent newsletter article by BloombergNEF for further insights.
Rene Savelsberg, Managing Partner at SET Ventures
SET has been a pivotal investor in the clean energy transition since our founding in 2007. Since then, we have witnessed our energy system undergo substantial change. We quickly observed that building sustainable infrastructure while promoting the purchases of EVs and heat pumps brings a larger systemic issue along with it.
We strongly believe that the world now has the technology needed to get to 100% carbon-free. Therefore, what we lack is not more science and engineering but instead innovative business models and markets that incentivize the use of existing renewable technologies and balance these sources within the grid.
We would like to call on all Climate Tech investors to join us in supporting these solutions. By backing the companies that deal with the volatility and inherent imbalance of our future energy system, we will be able to transition quickly enough to battle climate change on a global scale. This is why SET Ventures has launched SET Fund IV.
Our fourth fund is a 200M EUR fund designed to provide Europe’s most innovative energy entrepreneurs with the capital required to scale their solutions. By doubling the size of our previous fund, we aim to address a lack of capital in Europe, but more is needed. It has been remarkable to see the growth of Climate Tech in recent years, but now is the time for us all to support the innovative companies of today in building the carbon-free energy system of tomorrow!
Ade Thomas, Founder of Green.TV Media, EV SUMMIT, WorldEVDay
We live and work at the most pivotal moment in human history. We are at an energy and mobility crossroads. We either take the right turn to a positive, smart, sustainable future, or we take a very wrong turn. At the moment, reading the IPCC’s analysis and other data sets, I see us far exceeding the called-for 1.5 degrees cap on warming, that’s called on, by a dangerously worrying level. All the data pointers suggest we will hit 3 degrees, plus warming. Investors need to decide which future path they want to take and how quickly they travel down that path. They also need to think very hard about which direction their children will remember them for.
It’s clear that cultural parameters around marketing and media are key variables that determine investor confidence, both on a macro and micro level. On pivotal moments in E-mobility, we see consumer engagement stalling at circa 15% engagement and not bridging over from the early adopters to the early mainstream. Media and marketing platforms are needed to make that bridge.
On the micro level, marketing drives E-mobility start-ups from day one, not from a later day, when a new product or service is created, and this injects investor speed. I see this very directly in my work at Green.TV Media for start-ups that quickly become scale-ups, like EAV, the award-winning last cargo e-bike vehicle, and launching Volta Trucks.
At the macro level, what I call an ‘ideas infrastructure’ for change is needed. In my work, we are building this around E-mobility and energy engagement to engage businesses, consumers, and governments, notably, with the EV SUMMIT and with World EV Day. The EV SUMMIT has led to large infrastructure collaborations. We’re taking this, along with our partners, EY, to the biggest automotive market in the world, the US, to propel change in that key territory. With World EV Day, the world’s biggest mobility campaign continues to grow and shift the dial on EV engagement with deep political, business and consumer engagement. This year, World EV Day trended on Twitter / X and has become one of the biggest sustainability channels on LinkedIn. We will be working hard in 2024 to propel this global movement for transport and energy change.
We don’t have 10 years or 20 years for this project. We have now.
Federico Cristoforoni, Founder of NetZeroInsights
Addressing and adapting to the impacts of climate change is one of the most critical and intricate challenges of our time. It requires immediate and coordinated efforts across every sector, including local and international policies, investments, business strategies, and individual choices. While relying solely on technology will not be the ultimate solution, the urgency for innovative approaches has never been more crucial.
Innovation mainly serves a dual purpose: developing breakthrough solutions to the hard problems that can’t yet be solved and accelerating the widespread adoption of proven, mature solutions. Crucial considerations such as quality, price, accessibility, and alignment with the needs of both consumers and businesses should be central to their development.
Leveraging the privileged learnings I continue to gather at the intersection of data, finance, entrepreneurship, and climate innovation, my commitment is to dedicate my professional endeavours to nurture the growth of the ecosystem.
As we look ahead to the upcoming decade, I envision part of my role as attracting those fascinated by climate innovation, inspiring them to take action and contribute. My goal is to facilitate their exploration and deeper understanding of the solutions, challenges, and market dynamics, helping them bridge the gap between curiosity and active engagement.
Simultaneously, I aim to aid those already active in the field in making better decisions and reducing complexity. I plan to do this by assisting entrepreneurs in making their journeys more purposeful and effective, by providing decision-makers in governments, corporations, and financial institutions with qualitative, meaningful, and actionable information and by facilitating streamlined access to climate innovation for investors, buyers, and operators.
I strongly encourage all members of our ecosystem – innovators, investors, buyers, policy-makers, and operators – to actively participate and collaborate in our shared pursuit of developing and deploying impactful climate solutions.
Call to action
To all our friends and partners, a heartfelt thank you on behalf of the entire IMPROVED Team for being part of our journey towards 2033. Together, let´s make the next 10 years the most advanced ones yet!
For further updates, keep an eye on our LinkedIn page, and make sure to register for our weekly Energy and Mobility Newsletter.
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