Climate tech startups raised $53.7 billion in 2021, with nearly half ($22 billion) going to the transport sector, for technologies like lithium-ion batteries or electric aviation. Today, climate tech is a subset of “cleantech” and it encompasses technologies and business models that focus on decarbonizing six sectors: energy, transport, buildings and infrastructure, carbon and climate, industry and agriculture.
Even in the midst of a recession, some VCs believe companies pioneering our energy transition can expect to continue raising capital. Peter Gajdoš Partner and co-lead of Climate Tech at the VC firm Fifth Wall told Bloomberg he believes the regular ups and downs of market cycles are less of a factor for this industry. In fact, he mentioned that while he sees limited partners and backers fleeing traditional technology investments they are still allocating climate funds. His take is that corporate and government pledges to curb emissions are strong enough to overcome any economic uncertainties.
“Climate doesn’t care about inflation,” Gajdoš told Bloomberg. “The oceans are warming up. The forests are burning,” Gajdoš said. “These problems are still there, and someone needs to solve them, which creates opportunities.”
These developments, coupled with an already competitive landscape for media attention, and the fact that a fund raise is your best, and usually, first chance to gain Tier 1 media coverage, means startups in this sector must craft compelling, credible narratives, beyond how much money they raised. Not only is there more competition in raising the money, there’s competition in promoting it, too.
In the early days of the energy transition, called Cleantech 1.0, even the smallest amounts of funding for companies with solar, energy storage, and electric vehicle solutions, gained the attention of Tier 1, mainstream, business press, such as Bloomberg and Reuters. A decade and a half later, deals have grown, and become more frequent. From a reporter’s point of view, that makes the basic funding announcement less novel and less worthy of their time, unless there’s something more to the story – something notable beyond the ordinary, new or different.
What this means for startups within the energy transition and fighting climate change with their technologies is that the interest mainstream press has found in climate tech startups is illustrative of the larger growth of the industry. It is also indicative of more corporations and world leaders using their influence to sound the alarm that something must be done to curb greenhouse gas emissions. This is evident in the special climate and climate funding related desks that news organizations like the Wall Street Journal and the Associated Press established in the past year, and more climate reporters popping up from outlets like Wired, which previously covered this sector very little. .
The bigger the increasingly noisy climate tech marketplace gets, the better it is for everything living on this planet. This increased competition is a good thing for our collective goal of preserving a livable planet. But it also creates real PR challenges for startups.
Due to a saturation of funding announcements, and increased minimum deal size to warrant coverage, startups are increasingly challenging to secure mainstream coverage. Often, worthy funding announcements are either lost in the noise or never seen.
As the world truly starts to wake up to climate issues, it’s time to reconsider your communications strategy: funding releases aren’t what they used to be. It’s time to adapt.
A changing funding landscape
According to PwC, over 3,000 climate tech startups received investment between 2013 and 2021, and those numbers are growing. But coverage of these startups, and their successes, has changed: gone are the days when major outlets featured any relatively significant funding news. Where rounds of $5 million used to be sure-fire attention-grabbers, these days, reporters can get sniffy about $20 million Series A raises.
Simply put, there’s just more money invested in the space. For example, the total venture investment in EV battery startups went from $174.7 million in 2020 to $3.6 billion last year. That’s a lot of potential stories of funding coverage, and not every story can be told.
At Technica Communications, we’ve been working in the climate tech and sustainability markets since 2009. The last 24 months have seen a more significant change in the industry than any other time. In 2020, our commercial EV client Motiv Power Systems secured $15 million in funding, and we helped the startup tell its story in 149 outlets, including Reuters, New York Times, and TechCrunch. A year later, the same client raised $20 million, but the reach shrank. While the campaign results were still excellent, it was apparent that the reporters’ appetites were shifting.
As the media response to funding announcements shifts, so do Technica’s strategies to get the most out of funding announcements.
Stand in a shadow
If you’re a startup, leveraging big-name investors is gold dust. Make the most of attaching your brand to a high-profile organization or name. News outlets – and reporters – want to tell stories about well-known companies and entrepreneurs making a difference in climate technology. It’s why you can’t go a day without seeing Elon Musk’s name attached to an article, however minor the news.
Even a smaller round can get noticed with the right names behind it, and an interesting take on an industry problem. When our client AMPLY Power raised $13.2 million in a Series A round, the size of the round would be a struggle to garner much attention alone. However, the investors included Siemens and Soros Fund Management. Having those renowned names on board boosted the campaign to a potential reach of almost two million, including garnering coverage in TechCrunch and Bloomberg.
Even if your investor pool lacks a well-known brand, it’s likely the people participating in the firm or fund have personal brands that can be highlighted. Pointing out the past experience of investors in an announcement can help elevate the validity of your news, sometimes just as well.
The VC dollar
Everyone needs a little help from their investment friends. Startups can’t do it all by themselves; sometimes, VCs need to play their part in getting funding stories noticed.
Founder and CEO of Social Capital and billionaire tech investor Chamath Palihapitiya has predicted that the world’s first trillionaire will be someone fighting climate change. Investors are lining up to plow their money into tackling the climate crisis, with more than 1,400 investors in the sector. But while funding from the likes of Amazon Climate Pledge Fund can usually guarantee great reach, startups must seek funding from the right VCs whose goals are aligned with theirs.
VC brands that make the effort to build up their own brand equity, will be helping their portfolio investments startups through association. In today’s growing climate tech sector, firms have a responsibility to share their thought leadership in a variety of venues, as a way of pushing the whole industry forward while also elevating their brand status. This can take the form of published articles that illustrate the thought leadership behind their investments, offering contextual comments to reporters covering breaking news developments as well as speaking appearances to “rally the troops” of this sector. When VC firms make the effort to be more public and share their knowledge and expertise with the broader community, their brand rises because it is providing value to the group.
Our client Energy Transition Ventures as done executed a version of this strategy to great effect, garnering placements in CNN and Bloomberg among others.
Standing out in that crowd is challenging work, but catch hold of a trend, and your announcement can still fly. Earlier this year, we worked with our client Tritium on its exit to a public company through a SPAC and ensuing media campaign. While the SPAC and public listing itself wasn’t extremely newsworthy with the high volume of climate tech SPAC deals going on at the time, and mounting awareness that older SPAC companies have struggled to thrive, there was a great deal of mileage to be had in aligning it with President Biden’s Build Back Better Framework. By framing the news away from previous SPAC performance, and around a current and popular political initiative,Tritium could point to the American jobs it would be creating in the U.S. as well as the contribution it would make to helping the country society’s climate goals with a larger framework of EV fast-charging stations across the country.
It’s the story of our future
Beyond the numbers, names, and trends, is what a reader might “get” from learning the new information. For climate tech, cleantech and energy transition startups, there is an art in describing a technology solution in simple enough terms that connect with real problems facing humanity, that a reader “gets it ” almost immediately. This is storytelling. A good narrative is always at the heart of a good comms strategy. That’s nothing new. But, there’s a unique skillset into going beyond the facts and figures and still maintaining a level of journalistic integrity in a news release.
Funding stories need to clarify how the funds will be spent, who will be positively impacted, how the funding will specifically address the climate crisis, and how the company is moving their industry forward. Don’t just rely on the news itself; illustrate to the reader why the news is good or useful.
Even if you look at the most conservative scientific reports, there is still an urgency that we have roughly eight years to dramatically reduce our carbon emissions enough to mitigate the worst effects of climate change. It’s evident that this is our Decade of Action. As communications and marketing professionals, we can put our skills to work in the climate fight by going beyond the easy (and now ineffective) path of promoting a funding announcement. If we do more than feature the dollar figure in our announcements, we can take readers beyond the story. That level of promotion helps strengthen the companies we work for, help them be more successful and build a stronger foundation of our collective future.
We may not have the skills to invent remarkable technologies that could save our civilization as we know it, but we know what it takes to make that news rise above the noise.