Investing in Proven Climate Solutions: A Conversation with Laura Witt

CSI Climate Ventures Mornings are a chance to hear from climate solutions innovators and leaders.

This month, we got a chance to chat with Laura Witt, General Partner of the Drawdown Fund. Laura gave us insight into the mechanics of the Drawdown Fund, challenges in the sustainable investment space, and reasons for remaining optimistic about investing in climate solutions.

Read on for highlights from our conversation! (Or if you’ve got an hour to spare, get the full experience by watching the recording below.)

Climate solutions already exist

In the early 2010s, Paul Hawken worked with the world’s leading researchers, scientists, and policymakers to map and model 100 existing climate solutions. Then, they ranked them on their ability to stop climate change. This was the beginning of Project Drawdown.

What Paul and his collaborators found was this: the biggest challenge climate solutions face is implementation. We already have most of the solutions we need, but they aren’t being funded and implemented on anywhere near the scale we need.

Of course, implementation requires funding. So in 2018, Paul sat down with Erik Synder, now the CEO of the Drawdown Fund. They identified existing climate solutions that could be accelerated by capital or market mechanisms, as opposed to philanthropic dollars, government dollars, or culture change.

(That’s a fancy way of saying they went down Paul’s list of climate solutions and pinpointed the ones that could be best realized through commercial ventures.)

Thus, the Drawdown Fund was created. Today, they invest in three focal areas: sustainable cities, food and agriculture, and energy. They’re continuing to look for funders and growth-stage companies alike, with hopes of growing the fund to $250M and investing $10-30M in each of the ventures.

Making the investment case

We’re in the knowledge economy. It’s all about attracting the best talent to your company, and people are voting with their feet to work for mission-driven companies.

In recent years, the conversation around climate action has grown – but that hasn’t been reflected in the way we invest. Climate-focused ventures are still struggling to find capital.

“The way they manage big asset pools, they say: ‘Okay, we’ve got an allocation for technology investing, we’ve got an allocation for healthcare investing, we’ve got an allocation for investing in industrials. We don’t have a set allocation for investing in sustainable businesses,’” explained Laura. “Some people, unfortunately, look back to CleanTech 1.0 and say: ‘Venture capital had losses in CleanTech 1.0. What’s going to be different now?’”

It’s a bit of a chicken and egg situation. Investors want teams with successful track records, but few firms have proven their potential to drive strong investment returns while delivering measurable climate impact. After all, sustainable investing is still relatively new.

It’ll be a while before there is enough data to make a solid case for this area of investing. This prolonged time frame is a challenge in itself: “A lot of these companies are hard technology. They take a long time to build. It will likely take four, five, six, seven years for these companies to get through the life cycle, to get to liquidity events that show good returns to investors.”

Laura shared a story to drive the point home: “We’re talking to a company right now that looks interesting to us as a growth-stage company: millions of dollars of revenue, hundreds of customers. I was looking back at the company history and was reminded that this was a company that was founded in 2006. They signed their first commercial contract at the very end of 2013. So it took 7 years to commercialize this technology, to bring to market, to get it through pilots, and then get that first deal signed, and bring in the first revenue dollar.”

Knowing this, the Drawdown Fund is looking for investors who see the urgency of climate change, and are therefore willing to take on more risk and be patient. They’re more likely to be family offices, where key decision-makers all sit in one room, than institutions, who are more risk-averse. Institutions are seeing increasing demand from their clients for sustainable strategies, but are cautious about making commitments to these newer sectors.

Fortunately, public opinion has shifted and there have been louder, more frequent calls to support companies with sustainability built into their missions. Just look at Amazon, who recently announced a $2B Climate Pledge Fund for companies working to decarbonize the economy and protect the planet.

“We’re in the knowledge economy, and it’s all about attracting the best talent to your company. People are voting with their feet to work for mission-driven companies,” said Laura. “And consumers want to buy more from companies who have these mission statements.”

We’re all moving toward the same goals

There is potential for businesses that drive climate solutions to grow fast and generate high returns for investors.

With this sort of shift in demand, there is potential for businesses that drive climate solutions to grow fast and generate high returns for investors.

As we move into pandemic recovery, Laura remains optimistic. This is a chance for us to make decisions that build a more just, equitable, and prosperous world for all (what we at CSI call the “Next Economy”).

“I think it’s really promising. We are going to have a debate about how we direct these [stimulus] dollars in a smart way,” said Laura. “I saw the International Energy Agency release a big report outlining 60 cost-effective solutions where we could be putting stimulus money to work. […] They’re saying because these are such cost-effective solutions, you could actually generate more than a point increase in GDP growth over the coming years if you invest stimulus money in ways with positive climate effects.”

Her optimism is, in part, inspired by the entrepreneurs she’s met through the Drawdown Fund: “I’m meeting the smartest, most driven people who have chosen to dedicate their lives to this work.”

Our conversation with Laura covered so many topics, it was difficult to pick out a few to highlight in this recap. You can watch the full recording here, and do some further reading at the links below:

If you are or know a growth-stage company that could benefit from the Drawdown Fund, get in touch with Laura and her team. And if you want to hear more from the world’s climate leaders, keep an eye out for our next Climate Ventures Mornings!

Furniture That Feeds You

Audra's AEVA unit, a vertical indoor garden.

There are an unlimited number of approaches to building the Next Economy. Some of them are large-scale movements. Others are small actions you can take in your daily life.

Let’s talk about food systems. In some places, getting a hold of fresh food can be difficult, or expensive, or both. Just Vertical, a venture in our Climate Ventures Earth Tech accelerator, wants to make produce accessible for everyone.

“I’ve spent a lot of time in the Canadian Arctic studying and understanding food systems and supply chains,” says Kevin, one of Just Vertical’s co-founders. “I’m a banana-a-day kind of person, but fresh produce is expensive up north — if you can find it at all. With waits of up to six weeks for brown, mushy bananas that cost $2 each, I wasn’t a banana-a-day guy anymore.”

Red Robin Tomatoes sprouting out of the AEVA

That’s where the idea for the AEVA— a vertical indoor garden — came from.

The benefits of growing your own produce reach beyond having a secure and sustainable food source. Caring for your plants, or even just having a bit of green in your home, can be therapeutic.

“Our dream is to increase food security around the world,” Kevin remarks. “We hope our indoor farming technology will enable individuals to grow their own nutritious food, all year round, and help create a sense of food sovereignty within remote communities. As a complement to the existing food system, Just Vertical can help people eat better while lightening their impact on the planet.”

If you want to learn more about the AEVA’s origins and heartwarming effects of indoor gardening, you can read the full interview on our Climate Ventures website.

Pictured: sprouting red robin tomatoes from CSI’s very own Audra Williams‘ AEVA!

How EAIGLE is helping stop the spread of COVID-19

As provinces begin to reopen, the move back to our public spaces is met with mixed feelings: excitement, about being able to regain some semblance of normalcy, relief, for business owners who were struggling to pay rent, and also apprehension around being able to provide (or shop in) a safe environment. What’s certain is that businesses and customers alike will have to remain vigilant and continue to follow physical distancing guidelines.

When the severity of the situation became clear in March, EAIGLE adapted their technology to stop the spread of COVID-19. By monitoring the body temperature of guests, businesses, and public spaces can identify people who may have contracted the virus.

A company in our Climate Ventures’ Earth Tech accelerator, EAIGLE’s original focus was on water conservation. Using artificial intelligence, their technology could monitor crowds and analyze occupancy in real time, enabling buildings to optimize their water and energy use.

“I’ve always been looking for ways to make a positive impact on our planet, starting with cleantech energy and water conservation,” said Amir Hoss, Founder and CEO. “In buildings, HVAC systems and swimming pools are the two components responsible for the majority of energy and water usage – but in recent years, there haven’t been effective solutions developed to address these inefficiencies. We saw a huge opportunity to optimize these systems through AI.”

Amir and his team are grateful to be able to contribute to the fight against COVID-19.

“Our team has worked tirelessly for weeks to bring this solution to the public,” Amir said. “We are determined to put an end to this pandemic, and we are grateful that we can create a positive impact.”

Want to learn more about the amazing work EAIGLE is doing, and what the pivot looked like? Read the full story on our Climate Ventures website.

Rallying communities around geothermal heating and cooling

Did you know that heating and cooling are the main uses of energy in a home?

When Innovia GEO co-founder Andrew Lee found out, he knew he had to do something about it. Luckily, he was in a position where he could explore the positive impacts of geothermal technology.

He and co-founder Jim Ilkay had been asked to work on a townhouse development in Toronto. In a recent interview, he explained that the development had a partially constructed geothermal system. Andrew and Jim convinced the owners to let them investigate what a fully geothermal solution would look like, instead of switching back to natural gas furnaces and standard air conditioners.

It looked good on paper and, now, it looks even better in real life! 55 Toronto homeowners now have a clean, renewable energy source. The best part? It’s financed by the community.

“The community itself owns the geothermal system thanks to a green loan,” Andrew explained. “The homeowners then pay a monthly fee to the condo corporation — that fee covers maintenance costs and loan payments.”

The most exciting aspect of this community-ownership model is that once the loan is repaid, the homeowners can choose to reduce their monthly payments or use the geothermal system as an asset to secure another loan. “Those funds could be used for so many things, like building a community park,” Andrew said. “We’re really excited about how this structure can encourage more people to adopt geothermal, and how their communities will benefit from owning the system.”

Andrew is also passionate about educating anyone and everyone about geothermal heating and cooling, which isn’t widely understood in Canada. He told us to think of the system like a giant rechargeable heat battery. The Earth naturally absorbs heat from the Sun. In the winter, underground pipes filled with liquid concentrate this heat from the ground and bring it up into the building. In the summer, the process is reversed to move heat from the building into the ground. Because the system is moving heat rather than generating it, it’s much more efficient than burning natural gas or using air conditioning. “Typically, for every unit of electricity used to run a geothermal system, you get three to five units of heating or cooling,” Andrew added.

Want to learn more about geothermal tech and community-based financing? Read the full interview on our Climate Ventures website!

Earth Tech ventures on Earth Day 2020

International quarantine efforts to curb the spread of COVID-19 have made this is a pretty unusual Earth Day. Factory closures and and fewer cars on the road have seen air quality improving around the world. At the same time, Inger Andersen — the head of the UN Environment Programme — cautions us against celebrating environmental improvements that come on the back of tragic economic slowdown and human distress.

Anderson instead calls instead for a profound, systemic shift to a more sustainable economy that works for both people and the planet. This perspective is echoed in a recent op-ed in the National Observer by Foresight CEO Jeanette Jackson and CSI’s Director of Programs Barnabe Geis. The two point out that we now have the chance to create a green economy powered by clean energy and enabled by clean technology.

One way CSI’s Climate Ventures is working to build a New Green Economy is through Earth Tech, a six-month accelerator for those working on climate or freshwater technology solutions that will positively impact communities and ecosystems across Canada.

We reached out to Earth Tech participants to ask them what’s motivating them during these trying times, and what’s one positive thing they hope will come out of this crisis. We found their answers informative and inspiring.

Arian Shahnazari of Biopolynet:

Patricia Gomez of Clean Nature:

Sugeevan Shanmuganathan of Dunya Habitats:

Amir Hoss of EAIGLE

Bryce Jones of Flash Forest:

Andrew Lee of Innovia GEO Corp:

Kevin Jakiela of Just Vertical:

Jake Miller of Project Neutral:

Jane Ji of Springbay Studio Ltd.:

Ross Armstrong of Solar Wind Reliance Initiatives:

Amir Pahlevanpour of Volta Technique:

Kat Kavanagh of Water Rangers:

Do you have a product, service, or strategy to help tackle the climate crisis and put people and planet first? Climate Ventures provides coworking, community, and programs to accelerate your success and amplify your impact.

Op-Ed: Don’t let COVID-19 take down our clean tech sector

In addition to its contribution to saving the planet, the value of environmental and clean technology activities totalled $61.9 billion in 2017, and accounted for 3.1% of Canadian GDP. These tens of billions of dollars have been put at risk by the COVID-19 crisis.

Cleantech ecosystem accelerator Foresight, in partnership with CSI, recently surveyed more than 300 cleantech companies to learn the impacts this crisis has had on their work, and what would help keep them in business right now. The majority of those surveyed said what they needed was a one-time grant.

Foresight CEO Jeanette Jackson collaborated with CSI’s Director of Programs Barnabe Geis on an op-ed in the National Observer that shines a light on how important these types of investments are right now. As governments design stimulus packages to help us prepare for the post-COVID-19 world, they have the chance to create a green economy powered by clean energy and enabled by clean technology:

If there isn’t a concerted effort to support this sector right now, many companies will go bankrupt or be so delayed in getting their technology to market that Canada’s competitive advantage may be lost, and climate action will be delayed when we can least afford it. Instead of leading, as we were positioned to do, we will be playing catchup in the biggest, most important transformation since the Industrial Revolution.

In response to the COVID-19 pandemic, countries around the world are announcing trillions of dollars worth of monetary and fiscal stimulus. Where this money goes will reshape the global economy.

Canada must seize the moment, and invest in the future. This means ending subsidies to fossil fuels and not bailing out the economically unviable and ultimately doomed oil sands. This means investing in climate action broadly as well as cleantech specifically, leading to sustained job creation and economic growth.

Our response to the pandemic is our chance to make the best of a terrible crisis. If we prioritize short-term growth by investing in the status quo, we will have squandered our opportunity and financial resources, leading to untold economic and social hardships down the road due to a worsening climate crisis.

One way CSI’s Climate Ventures is working to build a New Green Economy is through Earth Tech, a six-month accelerator for those working on climate or freshwater technology solutions that will positively impact communities and ecosystems across Canada. You can meet the participants here.

Seven members of CSI’s Climate Ventures to meet this World Water Day

Since 1992, international climate justice activists have been holding World Water Day to inspire thinking and action on the importance of water. The theme for 2020 is “Water and Climate Change” and explores how the two issues are inextricably linked.

That link is top of mind at CSI’s Climate Ventures, where we are operating a six month accelerator called Earth Tech. Participants are social entrepreneurs working on climate or freshwater technology solutions that will positively impact communities and ecosystems across Canada.

We still have time to stop and reverse global warming, and, in the process, give rise to the next economy – one that is just, carbon neutral, circular, and regenerative. Here are seven participants to learn about this World Water Day.

With their patented BioNanoCoil, a biopolymeric technology, Biopolynet tunes the rheology of water in the conventional industries to boost their circular economy and significantly decrease their wastewater streams. 

CANN Forecast
Poor water quality and infrastructure management have a direct impact on citizens’ health and quality of life. New technologies such as artificial intelligence can support municipalities in their strategic decision-making. CANN Forecast develops smart decision tools for the proactive management of urban waters.

Clean Nature
Clean Nature developed and proposes guiA, an innovative and effective smart decision-making tool to prepare, intervene and adapt road-salt spreading more efficiently while reducing costs and environmental impacts.

EAIGLE is an Intelligent Video Analytics Platform based on machine learning and artificial intelligence for freshwater monitoring, automation and control, and sustainable operation in aquatics through real-time occupancy monitoring.

RainStick Shower is a recirculating shower that saves 80% water and 80% energy but feels like a high-pressure shower. Water at the end of your shower is safe enough to drink.

SENTRY is a unique bio-electrode sensor platform that provides real-time microbial performance and water quality monitoring for wastewater and water treatment facilities.

Water Rangers
Water Rangers builds tools to empower anyone to learn about, test and act to protect freshwater. Through an open-data platform and simple water testkits, they are transforming water stewardship.

Do you have a product, service, or strategy to help tackle the climate crisis and put people and planet first? Climate Ventures provides coworking, community, and programs to accelerate your success and amplify your impact.

Just Vertical wants to help you grow fresh produce in your home

As we start a new decade, we are asking community to to tell us what you learned in 2019, and what your dreams are for the next decade. Next up is Kevin Jakiela. Kevin is the Co-Founder and President of Just Vertical, a modern hydroponic garden that enables vertical farming. With their equipment, you can grow over 70 different plants, and up to 10 lbs of fresh produce on a monthly basis. Just Vertical is one of 16 ventures in the inaugural cohort of CSI’s Climate Ventures Earth Tech 2020 Program.

What were your biggest wins and lessons this year?
We were recently chosen as one of the most sustainable start-up companies in 2019 by Huffington Post and got the privilege to shoot a commercial with Toyota. Lessons learned so far this year deal with time management. Utilizing our time more efficiently throughout the work day and prioritizing tasks with greatest importance.

How has being part of the CSI community impacted your work?
The advisers and mentors have been instrumental on providing us with advise and direction for upcoming pitches and projects. Having the ability the run ideas by them and getting constructive feedback has been extremely helpful for us when trying to make appropriate decisions based on specific scenarios.

What is your favourite CSI memory of the year?
So far my favourite CSI memory this year has been the Earth Tech Kick-off Day. We were selected to be part of the first cohort among some other really incredible companies. It was really great to meet and really get to know other like-minded individuals all contributing social and/or environmental good to the same cause we believe in.

What is your big dream for the next decade?
We hope to make an impact in helping to decrease food insecurity across Canada and the world. Our goal is to enable individuals and communities to grow their own nutritious food, all year round, and help create more of sense of food sovereignty within remote communities with little access to fresh food. We hope to leverage our indoor farming technology to help compliment the existing food system by providing healthy food, with no GMO’s or pesticides, while using 95% less water

Do you have a product, service, or strategy to help tackle the climate crisis and put people and planet first? CSI’s Climate Ventures provides coworking, community, and programs to accelerate your success and amplify your impact.

“This is our Children’s Climate Crossroads.” – Barnabe Geis

Barnabe Geis is the Director of CSI’s Climate Ventures, an incubator for climate entrepreneurs, innovators, and leaders. He recently published a piece in the National Observer called Our Children’s Climate Crossroads. It is part personal essay, part climate primer, and part call to action.

Here is an excerpt:

We are facing a world devoid of coral reefs, a dying Amazon rainforest, frequent and worsening natural disasters, spreading disease, entire regions rendered nearly uninhabitable, a steep decline in agricultural outputs, economic downturn, and the displacement of millions of climate refugees. When I say ‘we’ it’s not some distant, amorphous ‘we.’ It’s you and me, and especially our children and grandchildren.

And yet, every single day we continue to dump 100 million tonnes of manmade global warming pollution into our atmosphere. And every year, air pollution kills seven million people worldwide, as our emissions constitute both a climate and health crisis.

Children are especially vulnerable to vector-borne diseases, waterborne diseases, heat stress, asthma, malnutrition, psychological stress, conflict, and homelessness, all of which are aggravated by climate change. Already, global hunger has regressed to levels last seen a decade ago due largely to extreme weather.

The good news is: at Climate Ventures, smart and talented people are collaborating on the solutions to climate change. If you want to see what that looks like, book a tour today!