February 2, 2023

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Air conditioning technology is not doomed despite climate change • TechCrunch

Veteran investor Dan Goldman is urging Climate Tech’s founders to watch the money and the carbon

In the world of air conditioning tech, Dan Goldman has seen just about everything: from the clean tech boom that led to the clean tech industry busting, to the dark years that followed, to today’s bull market that has made air conditioning tech one of the hottest Sectors of the company has made world.

TechCrunch caught up with Goldman this week to hear what he thinks about today’s market and what he’s telling his portfolio companies about preparing for next year.

“We want them to be extremely careful with cash at all times, but especially now,” he said. Although the reasons why that is so today are not necessarily the same as when the last cycle went bust about a decade ago.

Goldman has been investing for over 20 years. He comes from a more traditional energy background, advising on energy projects in Asia and financing large energy and power generation projects. He made the move to clean energy in the early 2000s and in 2006 he co-founded the Cambridge, Massachusetts-based Clean Energy Venture Group, a group of angel investors focused on energy-related climate technology. Later, in 2017, he co-founded Clean Energy Ventures to make early-stage investments. Over 100 pieces have been manufactured since the company was founded.

Clean Energy Ventures invests in early-stage companies that have received grants or angel investments but have not yet raised a venture round. The firm enjoys leading the first institutional investment round and helping to steer its investments in things like team development, intellectual property strategy and marketing strategy. She also introduces partners for follow-up financing, in which she often takes part.

As far as climate tech investors go, the company is relatively focused. While it invests in everything from materials recycling to hydrogen production to software, there’s usually an energy component involved. According to Goldman, Clean Energy Ventures performs a comprehensive life cycle analysis on each of its investments to ensure they meet the company’s “mandate”: Potential portfolio companies must reduce greenhouse gases from the company’s investment by a total of 2.5 gigatons by 2050.

“If they can do that, we think that aligns with financial return targets because we see the potential for them to grow into really big companies.” His optimism is based, at least in part, on recent data. “If you look at the stats of the broader risk markets, they’re down over 20% in the first nine months. And climate technology is up 50%,” Goldman said.

Advice for founders

Getting there isn’t easy, of course, and Goldman has some cautionary tales for founders. It’s not based on concerns about whether climate technology is going in the right direction, but on how much money has flowed into companies from investors who weren’t traditionally involved at earlier stages.