David James Connolly
Giant Leap's carbon revenue multiple for climate tech
After investing in climate tech businesses since 2016, we analysed Giant Leap’s data and found that on average, our climate tech portfolio directly avoids 1kg of CO2-e emissions for every $1 of revenue generated.
We see the potential for these companies to reach $100m in revenue, which would mean 100k tonnes of CO2-e emissions avoided per company per year, equivalent to 22k cars off the road or 1.7 million trees planted. And this isn’t even counting their indirect impact generating systematic change in their industries, which could be a substantial multiplier.
Check out the full analysis on Giant Leap’s carbon revenue multiple and its implications for addressing the climate crisis here.
What we’re thinking about
Deep tech, or ventures providing solutions to substantial scientific and engineering challenges, is fertile ground for exceptional impact opportunities. Cantos, a US-based impact VC, released their evidence, reporting their frontier investments into hard sciences like biotech and healthtech are generating the best returns across their portfolio at 4.8x invested capital. This includes companies like Twelve, which raised a $57m Series A last year to scale technology that turns CO2 emissions into useful reusable materials, and CATALOG, which raised $35m to scale its DNA-computing platform that can process massive amounts of data sustainably to accelerate health research.
🔬 Cantos’ returns are directly linked to one of the challenges of deep tech investing: venture investors typically underprice or overlook the opportunities because they don’t have the domain expertise to properly assess the technical risk. Promisingly, there are signals that domain expertise is building in Australia, with players like Main Sequence recently backing a UNSW biotech accelerator and Tech23 supporting some outstanding Australian deeptech ventures in genomics, fusion power, and pest detection. After recent successes in the healthcare space, Stephen Diggle also announced the launch of a 1b biotech fund for opportunities in Australia and the UK.
🪙 These domain experts have a unique role to play in building this impactful segment as their due diligence credibility unlocks capital from the broader market. Take the recent example of Baymatob, a medical device company addressing preventable pregnancy complications raising its Series A led by domain experts in the Australian Unity Future Of Health Fund with co-investors such as The Alberts, a generalist impact family office. Meanwhile, Venture Crowd, a generalist crowdfunding platform, launched a healthtech fund in partnership with LuminaX HealthTech Accelerator and Uniseed who can filter for the most technically viable opportunities.
David James Connolly