Latest Pillsbury + PitchBook Report Finds Nontraditional Investors Increasingly Lead Climatetech Deals

In the report, based on PitchBook’s proprietary corporate dealmaking data, Pillsbury partners Christina Pearson, Paul Casas and Steve Ryan provide comprehensive insights on the trends, risks and pressures surrounding the current state of climatetech investments. 

“Companies are facing increasing external pressure to focus more attention on their ESG initiatives…and also are trying to stay on the cutting edge of technology,” said Pearson, a Silicon Valley partner who serves as global leader of Pillsbury’s Corporate and Securities—Technology practice. “All these factors together are resulting in consistently strong corporate venture investing.”  

Among other trends, analysis of performance by industry category underscores the growth of climatetech innovation in commercial products and services, as the rapid advance of AI captures investor interest and data center power consumption skyrockets.  

“Data center development illustrates how digital transformation and the energy transition are converging in an urgent way and how important alternative power solutions will be to scale and meet demand,” Emerging Companies & Venture Capital partner Ryan said. 

The report tracks key climatetech VC metrics through early August 2024, including:  

• Startups in the climatetech space have raised $18 billion in venture funding across 1,058 deals so far in 2024. 

• Early-stage VC funding is driving sustained momentum: The biggest share of climatetech deals YTD were executed in the early stages, totaling 419 seed, Series A and Series B transactions worth $7.8 billion.  

• Two-thirds of 2024’s climatetech exits have been via acquisitions, with a median transaction size that has more than doubled 2023’s figure.  

• Nontraditional investors (NTIs), which includes the CVC subcategory, have invested $14.5 billion across 617 climatetech deals YTD, or 81.5% and 58.3% of total deal value and count, respectively. 

• CVCs continue to drive significant growth, with $10.9 billion invested across 377 deals YTD. A number of CVCs globally are solidifying their positions as leading climatetech investors, with a median of 44 investments across 10 major multinational corporates over the past decade.  

• Climatetech startups with an AI component raised $1.2 billion across 114 deals YTD, representing 6.7 percent and 10.8 percent of total climatetech VC deal value and count, respectively. 

“All the pain points in the broader venture economy are relevant for climatetech,” Casas said. “But there is still a sense of urgency and resilience in climatetech initiatives, especially with respect to CVCs that have both financial and strategic motives.” 

The analysis featured in Climatetech: Investment Trends & the Rise of CVC is based on Pitchbook’s proprietary Venture Monitor data methodology, along with Pillsbury’s extensive experience counseling climatetech startups and investors. 

To download the full report, click here. 

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