Investing in
Climate Tech

As uncertainty in government action lingers, the financial markets continue to funnel money toward reducing greenhouse gas emissions. Among the capital flows: private-market investments in young firms whose technologies are essential to achieving net-zero emissions. According to some estimates, 35% of the reductions required to get to net zero will need to come from technologies that have not yet been invented.

Investors who seek emerging climate tech opportunities can find them in the venture capital markets. PitchBook, a Morningstar company that publishes tools and data to analyze both private and public markets, tracks climate tech VC activity across nine segments, including electric transportation, food systems, and grid tech. PitchBook counted 1,134 deals in the trailing 12 months to March 2022, worth $44.5 billion. Electric transportation attracted the most funding, at $13.8 billion, while food systems had the most deals, at 288.

Lithium is not scarce. But it can be hard to extract economically and in a way that does not damage the environment. Current brine extraction mining technology uses evaporation pools that are water-intensive and create pollution. New mining tech flows lithium brine through a bonding material that extracts lithium directly, doubling lithium yields, reducing water usage, and shrinking production times.

PitchBook counts six lithium mining tech venture capital deals since September 2021, worth a combined $196 million. Top lithium venture capital-backed startups include Lilac Solutions, Cornish Lithium, Summit Nanotech, British Lithium, Green Lithium, and Novalith. Between them, these companies have raised $251 million in venture capital, according to PitchBook.