Marrakech Express: Bridging the Climate Innovation Gap with Strategic Philanthropic Investments (Webinar)

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Rather than bemoan venture capitalists’ lack of interest in early stage innovation to tackle climate change, Sarah Kearney and her PRIME Coalition have set out to show VCs and other investors how it an be done.

fullstackAs the follow-up to last year’s Paris climate accords approaches (in Marrakech Nov. 7-18), PRIME’s model caught the eye of ARPA-E, the Department of Energy’s Advanced Research Projects Agency-Energy. ARPA-E IS modeled after the Pentagon’s DARPA lab, which brought us the Internet, among other innovations. ARPA-E “advances high-potential, high-impact energy technologies that are too early for private-sector investment.”

Watch ARPA-E’s webinar: “Charitable Investment for Energy Innovation 101”

ARPA-E invited PRIME’s Kearney, along with ImpactAlpha, to join a webinar to discuss how to bridge the early-innovation capital gap using “program-related investments” by philanthropic foundation. PRIs, a mechanism through which philanthropic funds can be invested in market-based solutions, can de-risk or otherwise help complete investment deals that otherwise might not get done (see “Early Traction: PRIME Coalition Investments Bridge Capital Gap for Early-Stage Climate Solutions).

Venture capital has been a poor fit for many promising climate-change solutions, many of which may not pay off for a decade or more. That has starved clean technology startups of the capital they need now to develop solutions that the world will need in 2025 and beyond.

PRIME sources, vets and presents early-stage energy ventures to a cohort of foundations interested in deploying PRIs to fight climate change. The model suggests a clear role for philanthropy in closing the funding gap for early-stage energy and climate-change technologies.

Watch ARPA-E’s webinar: “Charitable Investment for Energy Innovation 101”

Even after the breakthrough global climate agreement in Paris last December, venture capitalists invested barely $800 million in cleantech in the first half of 2016, out of $28 billion in total VC investment, according to the PriceWaterhouseCoopers/National Venture Capital Association MoneyTree report.

ImpactAlpha has made a specialty out of understanding the complex funding mechanisms, including through our deep dive into the strategic investment portfolio of the Bill & Melinda Gates Foundation. On the webinar, I cited examples of how PRIs have helped bridge capital gaps for conservation finance, early-stage biotech research, first-time impact fund managers and other examples.

Watch ARPA-E’s webinar: “Charitable Investment for Energy Innovation 101”