This article was adapted from the Climate Tech Weekly newsletter, delivered Wednesdays.
There may be more funding for climate tech startups floating around than ever — roughly $17 billion in the first half of 2021 alone — but that doesn’t mean investors aren’t doing their due diligence. "It takes a long time to win hearts and minds all the way to the paperwork," observes Allison Dring, co-founder and CEO of German startup Made of Air, which in early October disclosed a $5.82 million round of seed funding.
The materials company, which in late June won the Accelerate fast-pitch competition at the Circularity 21 conference, is developing a process that turns wood waste into thermoplastics — building on the carbon sequestration potential of the biochar process. The idea is to turn everyday products into carbon sinks, and the material is so far being used in several ways. Audi is using the material in "carbon negative" facade panels at one of its high-profile dealerships; H&M has developed sunglasses; and the company is also partnering with a U.S. furniture manufacturer.
"We see the biggest resource that we have as a civilized population is the CO2 in the atmosphere," Dring said. "We are essentially taking that resource from the air and turning it into manufactured goods."
Made of Air’s seed funding was led by the TD Veen family fund and included individual investors such as Olympic gold medalist skier Aksel Lund Svindal and former Google CFO and Twitter Chairman Patrick Pichette. TD Veen helped bring in the other investors, Dring told me.
Made of Air will use the money to expand its production capacity in Berlin — it will create raw materials that will be sold to other manufacturers — and expects to triple its staff in the next year, she said. That experience will be used as a stepping stone for its Series A funding.
Made of Air is one of more than 166 climate tech and circular economy startups that have pitched their business plans and technologies during GreenBiz events over the past 10 years as part of the Accelerate fast-pitch competition, which spotlights promising, early-stage entrepreneurs. More than 1,000 people have engaged with the program; among the pitching finalists, about 76 percent are still actively in business and 9 percent have made exits (by being acquired or, in the case of one company, by going public).
What’s up with some Accelerate alumni
I don’t have enough digital ink in this newsletter to provide an update on every past Accelerate finalist, but some, such as Chicago-based circular assets startup Rheaply, have claimed plenty of headlines. In the two years since it competed, Rheaply has forged high-profile partnerships with the cities of Chicago and San Francisco. In February, it disclosed an $8 million Series A round led by High Alpha and 100 Black Angels and Allies Fund.
Here are other VERGE alumni companies piquing my interest this year:
- Carbon accounting software company Sinai Technologies, which helps companies set an internal price on carbon, scored a $10 million seed funding round led by Obvious Ventures.
- Natural Capital Exchange (NCX), formerly known as SilviaTerra, closed a $20 million Series A round led by TIME Ventures, the venture fund started by Salesforce founder Marc Benioff. The startup’s technology helps verify the carbon sequestered by forestry projects.
- Alternative protein venture NovoNutrients snagged $4.7 million for its plan to turn CO2 into food, bringing its total raised to $9 million.
- Soil carbon measurement startup Boomitra (originally known as ConservWater) in late June raised $4 million from a group that included the corporate venture arm of Yara International (the world’s largest fertilizer company) and fossil fuels company Chevron.
- Since its appearance in 2012, financing company Solar Mosaic has helped fund residential solar and energy efficiency projects for more than 160,000 homes — securing more than $5 billion in loans. Its last $1 billion took just five months to orchestrate earlier this year.
- XL Fleet is probably the highest-profile Accelerate participant to date. The commercial fleet electrification company went public in December in a SPAC transaction, although it currently faces a class-action lawsuit over the valuation.
Have news about another former Accelerate finalist or winner? Share it at [email protected].