How CEV Helps Startup Companies Evaluate Environmental Impact
A new tool was launched after the VC business started requiring data related to carbon removal potential as a part of its pre-application process for startup businesses. The tool launched earlier this week and has been already used by more than 140 potential startup applicants.
"Many startups and founders have large ambitions for mitigating GHGs, yet the task of estimating their company's emissions reduction potential can seem overwhelming," said Shanbor Gupta, investment manager at Clean Energy Ventures, who helped build SERC.
"The Simple Emissions Reduction Calculator was developed to fix this problem and provide a baseline for startups and investors to build on during investment discussions."
CEV is a $110 million VC company that backed a number of early-stage startup companies, including Leading Edge, a company that strives to slash solar panel production costs, and Aqua Membranes startup, which produces 3D-printed reverse osmosis filtration systems.
Any company that wants to apply for CEV funding is required to be able to reduce a minimum of 2.5 billion tons of CO2-equivalent by 2050, Miller said.
CEV’s calculator tool is simple to use and includes only six questions, without taking into account other important climate issues like water consumption or waste. The SERC also does not consider environmental justice or social concerns, even though the VC requires companies to give information about the diversity of their teams.
The SERC has already been embraced by two other cleantech accelerators, including Cleantech Open and Cleantech Scandinavia. Cleantech Open plans to use the tool to educate business entrepreneurs about how to better present the environmental impact of its technology.
"Empowering our entrepreneurs to quantify their CO2e impact should help them not only secure funding, but also attract customers, partners and employees. We have decided to incorporate the SERC tool into our curriculum this year to give the startups a boost as they launch and scale their businesses,” said Beth Zonis, the director of Cleantech Open Northeast.
Metal processing tech company Nth Cycle is one of the startup businesses that used the SERC and went to close a $3.2 million business funding round with CEV in April. The startup business described the tool as a "succinct and easy way" for the team to evaluate its impact, said Megan O’Connor, the company’s founder and CEO.
The metal-processing business said it would use the business funds to develop pilots with recyclers and mine operators. O’Connor pointed out that being able to reflect more specifically about the CO2-equivalent removal potential has helped her company reach potential business investors and customers, especially in the electronics and auto industries.
VC companies injected more than $16 billion in climate-tech startups by 2019, marking a 3,750% surge from 2013, according to PwC estimates.
Boston-based VC company CEV launched a new tool to help startup companies evaluate the environmental impact of their technology as a part of their pre-application process.
About the Author
Mariliana has an MSC in consumer analytics and business strategy. She has a special interest in fast-moving industries and big data.