⭐ #113: Your climate tech sector is over-hyped
2-minute read: Climate, startups, productivity, leadership
Good morning, folks.
In today’s 2-minute read, we’ll cover these 4 nuggets below — as delightful as an outdoor shower at a rainforest eco-lodge (without leeches).
Climate Startups & Investment:
#1 — 📈 Is your climate tech sector over-hyped?
#2 — 💵 31% gap in investors’ net zero goals.
Productivity & Leadership:
#3 — 🤔 A better way to argue.
#4 — 😨 “Your web pages sucks.” But so did Google’s.
Onward and upward,
Chris
P.S. Want more? Read 100+ prior newsletter issues here.
#1 — 📈 Is your climate tech sector over-hyped?
This new report, The Future of Climate Tech, comes from SVB.
(Control your PTSD from March 10, 2023. These 22 pages are worth your read.)
In the graph below, they make their best guess on which climate sectors are:
Rising in hype (left side of the peak)
Falling towards the valley of Disillusionment (middle of the graph)
Rising again towards the Plateau of Productivity (right of the graph) — i.e., mature tech that’s scaling
Are they right?
Of course not. This is imperfection personified.
But if your sector falls within those red lines, you might need to ask yourself:
Is SVB’s analysis partially right?
If so, how do we show strength in a time of perceived weakness?
How can we go on offense when everyone else is playing defense?
Why are we different than all of our peers who are losers? (Too harsh?)
In addition, other helpful graphs from the report show the following:
US Climate Tech Unicorn Deals
Change in Median US Post-money Valuation by Series 2021 – 2023 YTD
Total US VC Climate Tech Fundraising Since 2021 by Fund Strategy
The 100% Guaranteed Path to IPO in 2 Years with a 100X Return*
Active US Investors by Stage and Sector
US Climate Tech Fundraising
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* Not really. I’m just seeing if you’re paying close attention here. 😂
#2 — 💵 31% gap in investors’ net zero goals.
Ever heard of the Golden Rule?
No, not that one.
This is not a lesson in world religions. (But that could be fun.)
I mean this version:
“He/she with the gold rules.”
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If only this were applied to climate-related investing goals…
As you can see below, there is a gap between what Limited Partners and General Partners are doing on this front.
It’s time for Limited Partners to start insisting that General Partners focus on the nexus of climate risks and fiduciary responsibility.
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General Partners — aka, GPs or fund managers (VC, private equity)
27% of the top 25 GPs have explicitly set climate goals for their portfolio emissions reductions
25% committed to net-zero portfolio emissions by 2050
16% have established 2030 portfolio reduction targets
Limited Partners — aka, LPs (e.g., pension funds, endowments)
60% of the top LPs have set portfolio net-zero goals
56% of LPs have targeted net-zero portfolio emissions reduction by 2050
Thanks to Illai Gescheit for his writing on FCLTGlobal’s survey.
#3 — 🤔 Here’s a better way to argue.
We’ve all referenced the “Straw Man” in brainstorming sessions — that spineless, amoeba-like idea just waiting to be squashed by a better one.
In contrast…
Have you ever heard of the “Steel Man”?
No, not the 2013 superhero film based on the DC Comics character Superman.
Using the Steel Man technique in debates works like this:
“It’s building the best form of the other side’s argument and then engaging with it.
It’s being charitable and patching up the weaknesses in the other side’s proposition so that he can bring the best counterargument to your point of view.
If you can’t respond to the strongest argument from the other side, there’s a good chance you’re wrong.”
Taken a step further…
Here’s a fun cartoon for the best kind of nerds who know what the Turing Test is — i.e., “a test of a machine's ability to exhibit intelligent behavior equivalent to, or indistinguishable from, that of a human.”
Thanks to Louis Chew at Constant Renewal for his writing about this.
#4 — 😨 “Your web pages sucks.” But so did Google’s.
Some serial entrepreneurs think this:
“If you’re not embarrassed by your first product launch, then you waited too late to launch.”
(That’s also a great way to waste your “one shot” to make a good first impression on potential customers.)
And at some point along the journey, most innovators think:
“My product / service sucks. What the !%# am I doing?
Maybe I should just go be that fisherman in Mexico satisifed with the simple life instead.”
Based on the early home pages of billion-dollar giants, we all have room — and grace — to iterate and grow our way to “success.”
Thanks to Steph Smith — host of the a16z Podcast and author of “Doing Content Right” — for this nugget.
That’s all, y’all.
Make it a great week, because it’s usually a choice.
Cheers,
Chris
The #1 climate CEO peer group in North America
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(As evidenced by these photos, I’m a real human. Not an AI. 🤫 I promise.)
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