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Windfall Bio is seeing strong demand for its methane-eating microbe startup | TechCrunch

April 13, 2024 9:41 PM0


When Josh Silverman started shopping around the idea for his methane-eating microbe startup, Windfall Bio, eight years ago, the market just wasn’t ready. Nobody cared about methane, he said. Companies were instead focused on lowering their carbon emissions. But a few years later, the market is starting to come around.

Menlo Park–based Windfall Bio raised a $28 million Series A round to expand its commercialization efforts. The round was led by Prelude Ventures with participation from Amazon’s Climate Pledge Fund, Incite Ventures and Positive Ventures, among others, as well as existing investors, including Mayfield.

Windfall works with industries that produce large levels of methane, such as agriculture, oil and gas, and landfills. The startup supplies methane-eating microbes that absorb methane emissions, turning them into fertilizer. Companies can either utilize the fertilizer themselves, if they are in the agriculture sector, or they can sell it as a revenue stream.

“We think there is a big opportunity to leverage this natural ecosystem that gives us a low-cost solution without needing massive investments in capital like we are seeing for these other carbon capture technologies,” Silverman said.

While it took a couple of years to really get investors and companies on board, Silverman said that since the Windfall raised its seed round last year and emerged from stealth in March 2023, demand has been high.

“We have had a massive influx from all continents and all verticals; huge amounts of excitement,” Silverman said. “It’s profitable for everybody regardless of the industry. Everyone wants to reduce their carbon footprint, and they want to do it in a way where they make money and there aren’t many solutions.”

Silverman says that carbon capture was the only focus for so long because once carbon is in the atmosphere, it lasts forever, compared to methane’s 10- to 12-year lifespan. A few decades ago, when people thought about climate change, they were looking for more long-term solutions. But now that the impacts of climate change are both more clear and worsening, people are waking up to the need for both short-term and long-term solutions.

“We have literally missed every single climate target we have put in place,” Silverman said. Not a single G20 country has the policies needed in place for it to reach the Paris Agreement’s emission-reduction targets, for example. “If all you are doing is looking out in the future and not doing the day to day, you miss those targets and miss what is right in front of you. We need to manage the short-term climate factors, or we won’t be around to deal with the long-term.”

The lack of attention to methane is also surprising because methane actually can create a better ROI for companies than their carbon-reduction efforts.

Carbon is waste, which means that when companies capture it, they do so largely just to get rid of it, as opposed to turning it into something else. In comparison, methane is energy, which means it can be captured and repurposed much easier than carbon. Essentially, companies can reduce carbon for potential cost savings down the road, or a super legit carbon credit, while focusing on methane can actually make them money if they work with a company like Windfall.

This deal also stood out to me because Windfall lies within a growing category of startups focused on mitigating the climate issues of today and not just the ones down the road. While it is good for companies to be focused on mitigating the long-term impacts of climate change or trying to prevent future climate-induced events, we need solutions now.

It reminded me of Convective Capital, a venture fund I’ve written about before that’s dedicated to wildfire tech. It’s not dedicated to the tech that helps prevent them but rather tech that helps society adapt to the impact of increased wildfires now. Firm founder Bill Clerico told TechCrunch in 2022 that while it’s great to build long-term solutions, those mean nothing if your home is in danger from wildfires this summer.

Silverman said the market is still in the early innings of coming around to the potential benefits of investing in methane-reduction technology. But progress is good, and though he might be biased, Silverman is happy to see funding heading to a climate company that isn’t another carbon credit startup. I agree with him there.

“It was a long road getting here, lots of years of zero traction,” Silverman said. “Now that the traction is there and there aren’t very many people working in this area, there aren’t that many competitors. We are the best of the very few options. As I’ve said, ‘in my land of the blind, the one-eyed man is king.’”


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Climate tech VC Satgana closes first fund that targets early-stage startups in Africa, Europe | TechCrunch

April 13, 2024 10:25 AM0


Climate tech VC Satgana has reached a final close of its first fund, which aims to back up to 30 early-stage startups in Africa and Europe.

The VC firm reached a final close of €8 million ($8.6 million) following commitments from family offices and high-net-worth individuals, including Maurice Lévy of the Publicis Groupe, and Back Market co-founder Thibaud Hug de Larauze.

Satgana founder and general partner, Romain Diaz, told TechCrunch that the firm decided to close the fund early, missing initial targets owing to the difficult fundraising environment, which is worse for first-time fund managers, to focus on investing and supporting portfolio companies.

“We launched the fund mid-2022, and we have raised in the most challenging time since 2015. We have managed to make 13 investments and we know that with the current capital commitments, we can execute upon our strategy of investing in 30 companies in this first fund, including follow-on investments,” said Diaz.

“This also paves the way for a new fund in a few years, and it’s likely that we launch different funds with different strategies, maybe one for Europe and another for Africa — but that will come in later; for now, we are really focused on getting this fund right,” he said.

The VC firm invests up to €300,000 ($325,000) in early-stage startups working on mitigating and building resilience to climate change, with a bias for mobility, food and agriculture, energy, industry, buildings and the circular economy subsectors.

African climate startups set to gain ground as VC funding shifts their way

Its investees in Africa include Amini, a startup bridging the environmental data gap in Africa; Mazi Mobility, a Kenyan mobility-as-a-service startup working to develop a network of battery-swapping infrastructure; Kubik, which upcycles plastic and has operations in Ethiopia; and Revivo, a B2B marketplace selling electronic spare parts giving products like phones a new lease on life. In Europe, Satgana has invested in Orbio Earth, Yeasty, Loewi, Arda, Fullsoon and Fermify.

Diaz founded the VC firm after a decade of experience in the venture space in several African countries, including Morocco and South Africa, where he co-founded and ran a venture studio.

“I ran it for like five years, and about six years ago I started to really have the awakening to the extent of climate change. That’s where I decided to channel all the knowledge from my previous experience, but on a bigger scale, while focusing solely on investing in climate tech founders,” he said.

Diaz launched the VC firm upon moving to Europe, where he said there are adequate investment networks, especially those focused on investments targeting founders at the pre-seed stage.

Satgana’s focus on Africa was also driven by the fact that it is the most vulnerable continent despite contributing the least amount of greenhouse gas emissions. They recently appointed Anil Maguru as partner to drive their Africa strategy.

“We are entering the continent to pursue green growth objectives; so deploying renewable energy, low carbon buildings, mobility solutions and so on. But we are also keen on investments driving adaptation to climate change, because unfortunately, the reality is that climate change is upon us, and we require solutions already. This is especially for people on the frontline, who are often vulnerable communities, mainly women, people of color and low-income communities that are more exposed to the effects of climate change,” said Diaz.

“From an impact perspective, it’s important for us to invest in solutions, which [traditionally] receive only a tiny fraction of VC money,” he said.

Satgana is among the new funds that are dedicated to the African climate tech sector. These funds include Africa People + Planet Fund by Novastar Ventures, Equator’s fund and the Catalyst Fund.


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MIT tool shows climate change could cost Texans a month and a half of outdoor time by 2080 | TechCrunch

April 13, 2024 10:07 AM0


There are a lot of ways to describe what’s happening to the Earth’s climate: Global warming. Climate change. Climate crisis. Global weirding. They all try to capture in different ways the phenomena caused by our world’s weather systems gone awry. Yet despite a thesaurus-entry’s worth of options, it’s still a remarkably difficult concept to make relatable.

Researchers at MIT might finally have an answer, though. Instead of predicting Category 5 hurricanes or record heat days, they’ve developed a tool that allows people to see how many “outdoor days” their region might experience from now through 2100 if carbon emissions growth remains unchecked.

The results might be alarming or comforting, depending on where you live.

For people in California or France or Germany, things don’t look so bad. The climate won’t be quite as hospitable in the summers, but it’ll grow a little bit more clement in the spring and fall, adding anywhere from a few days to nearly a month of outdoor weather compared with historical records. The U.K. will be even better off, gaining 40 outdoor days by the end of the century.

Not everyone will come out ahead, though. Some temperate places like New York, Massachusetts, China and Japan will lose a week or more of outdoor days. Elsewhere, the picture looks even more dire. Illinois will lose more than a month of outdoor days by the 2080s as the summers grow unbearably hot. Texas will lose a month and a half for the same reason.

Yet it’s the countries with some of the most vulnerable populations that’ll suffer the most (as scientists have been warning). Nigeria’s summers will grow even hotter and longer, lopping off nearly two months of outdoor days. India will lose almost two and a half months.

It doesn’t have to be that way. Even if the world fails to reach net zero carbon emissions by 2050 — but still manages to by 2070 — the situation will improve dramatically. Both Nigeria and India would only lose one month of outdoor days, and more northerly regions would retain some of their added outdoor days.

Assessing risk

The MIT tool is a relatable application of a field of study known as climate scenario analysis, a branch of strategic planning that seeks to understand how climate change will impact various regions and demographics. It’s not a new field, but as advances in computational power have fostered more sophisticated climate models, it has become more broadly applicable than before.

A range of startups are using this relatively newfound predictive capability to help give shape to an uncertain future.

Many startups in the space are focused on tackling that uncertainty for investors, lenders and insurers. Jupiter Intelligence, Cervest and One Concern all focus on those markets, supplying customers with dashboards and data feeds that they can tailor to regions or even assets of interest. The startups also determine the risk of flood, wildfire and drought, and they’ll deliver reports detailing risk to assets and supply chains. They can also crank out regulatory disclosures, highlighting relevant climate risks.

Investors and insurers are sufficiently worried about how climate change will affect assets and supply chains that these startups have attracted some real cash. Jupiter intelligence has raised $97 million, according to PitchBook, while Cervest has raised $43 million and One Concern has brought in $152 million.

While major financial institutions are an obvious customer base for climate forecasting companies, other markets exposed to the outdoors are also in need of solutions.

ClimateAI is targeting agriculture, including agribusiness, lenders, and food and beverage companies, all of which have watched as droughts, floods and storms have decimated crops. As a result, water risk assessment is a key feature of ClimateAI’s forecasts, though it provides other weather and climate-related data, too. The startup has raised $37 million so far, per PitchBook.

Sensible Weather is working on markets that are a little closer to home for most of us. It provides insurance for people embarking on outdoor events and activities, from live concerts to camping and golfing. It works with campgrounds, golf courses, live event operators and more, allowing them to give customers an option to insure their outing against inclement weather. It’s an approach that’s landed the startup $22 million in funding, according to PitchBook.

As more businesses and consumers become aware of how climate change is affecting their lives, their demand for certainty will create a wealth of new markets that will offer these startups and their peers ample opportunity to expand. Climate scenario analysis, once a niche limited to academic labs and insurance companies, appears poised to enter the mainstream.


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Robotic Automations

New Summit is raising a new $100 million fund to back climate tech and underrepresented fund managers | TechCrunch

April 13, 2024 9:25 AM0


New Summit Investments is raising a new $100 million impact fund, according to documents filed with the SEC. The hefty new fund, should it be raised, will let it continue investing in managers backing startups and other companies focused on environmental and social problems.

This is the firm’s fifth fund and marks a sizable jump from the $40 million of its previous fund, which closed back in 2022. New Summit invests in various other funds, including venture capital, real estate investors and infrastructure investors. It currently has $115 million in assets under management, according to PitchBook.

New Summit declined to comment on the new fund’s strategy or timing, citing security regulations. “We launched one of the first multi-manager strategies for private market impact investing in 2016 and are pleased to be continuing this work,” Casey Dilloway, the firm’s managing director, told TechCrunch.

The size of the new fund suggests that it is bullish that it can convince LPs to open their wallets based not only on the firm’s investment history but also on its impact-focused approach. The fund-of-funds approach helps smaller investors place bets by finding the best-performing firms that also hew to their environmental and social requirements.

The SEC form indicates that New Summit is early in its fundraising process, and hasn’t secured any capital commitments yet. So, this is an interesting test case on if investors still have an appetite for ESG. The minimum investment is $250,000, the form says, indicating that the firm intends to approach investors of various sizes and risk appetites.

One thing going for this fundraise is New Summit’s interest in climate tech, which has bucked trends in venture capital, with deal counts remaining high throughout 2023, according to PitchBook. Last year, total investment hit $41.1 billion. While that’s off a peak of $51 billion in 2021, VCs say that climate remains one of two hot sectors where deals close fast. AI is, of course, the other.

Although the explicit focus on diversity, equity, and inclusion might be under fire from commentators, there is still a pressing need to provide opportunities to underrepresented founders, who tend to take more inclusive approaches to technology and business. New Summit has supported marginalized fund managers by launching initiatives like its partnership with investment firm Gratitude Railroad to source and underwrite underrepresented fund managers.

New Summit has also invested in several diverse fund managers who specialize in climate and health, including Black Opal Ventures and Buoyant Ventures, in addition to a range of other climate tech VCs, including ArcTern, Al Gore’s Generation Investment Management and Obvious Ventures.

New Summit Investments’ was founded in 2016 as an impact investment firm focusing on climate, health and economic opportunities. Its thesis adheres to the UN’s 17 Sustainable Development Goals, a framework to help create a more equitable planet by addressing issues such as access to clean water, quality education and poverty reduction.

New Summit Investments’ first fund closed for $20 million in 2016, followed by $36 million in 2018, according to PitchBook.


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Robotic Automations

Nvidia might be clouding the funding climate for AI chip startups, but Hailo is still fighting | TechCrunch

April 12, 2024 11:53 PM0


Hello, and welcome back to Equity, a podcast about the business of startups, where we unpack the numbers and nuance behind the headlines. This is our Wednesday show, when we take a moment to dig into a raft of startup and venture capital news. No Big Tech here!

Keep in mind that Y Combinator’s Demo Day kicks off today, so we’re going to be snowed under in startup news for the rest of the week. Consider today’s show the calm before the storm.

On the podcast this morning we have BlaBlaCar’s new credit facility and how it managed to land it, how PipeDreams could be onto a new model of startup construction, GoStudent’s rebound and profitability, Hailo’s chip business and massive new funding round, and the two new brands that GGV calls home as it divides up its operations on both sides of the Pacific Ocean.

Equity is TechCrunch’s flagship podcast and posts every Monday, Wednesday and Friday. You can subscribe to us on Apple Podcasts, Overcast, Spotify and all the casts.

You also can follow Equity on X and Threads, at @EquityPod.

For the full interview transcript, for those who prefer reading over listening, read on, or check out our full archive of episodes over at Simplecast.




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DCVC wanted to raise $500M for its first climate fund, but the market had other plans | TechCrunch

April 12, 2024 5:33 PM0


DCVC’s target for its first climate-focused fund, DCVC Climate Select, has been all over the place and highlights the roller-coaster venture fundraising conditions of the last few years and how LPs aren’t as quick to back new strategies from established managers.

The Silicon Valley VC firm launched the fund in December 2022 with a $500 million target, according to an SEC filing. A year later, it lowered its target to $300 million after its year of fundraising brought in only $157 million of commitments by then, according to a December 2023 SEC filing. Now, a source familiar with the matter tells TechCrunch that things have started to fall into place and $400 million may be a more accurate reflection of where the fund is headed.

A recent New Mexico Inno article about New Mexico SIC’s $50 million commitment to the fund that also mentions the $400 million target is “consistent with our expectations around the fund,” DCVC spokesperson Nate Nickerson told TechCrunch over email.

DCVC is a deep tech firm co-founded by Matt Ocko, known for decades of investments (like MosaicML, bought by Databricks) and Zachary Bogue, known for Square, AngelList, Uber and for his annual ​“Deep Tech in Davos” event. As part of the Davos event in February, Bogue called out AI applications for climate technologies as one of the “major opportunities” for DCVC, alongside tech bio and robotics.

This climate fund is targeting climate startups at the mid-stages where the firm thinks the climate startup ecosystem is currently underfunded, according to materials from a recent New Mexico State Investment Council meeting where the GP presented. Although this is DCVC’s first climate tech dedicated fund, the firm has invested $360 million from other funds into such startups over the last decade, also according to New Mexico SIC’s March 26 meeting.

While Nickerson said the initial $500 million figure was just a pro forma amount before the fund could take on money from LPs, the industry standard is that this number does represent a fund’s target. Internally, people at the firm know that the firm had to adjust its expectations to more “sober” market conditions, the source familiar with the matter said.

This person added that DCVC’s existing portfolio climate companies started seeing some wins entering 2024 that could be helping the fundraising journey. One example is Twelve, which creates products traditionally made using fossil fuels from carbon. It recently signed a 14-year purchase agreement with the International Airlines Group — which includes airlines like Aer Lingus and British Airways — to buy 260 million gallons of Twelve’s more sustainable aviation fuel.

“These are not small deals, small numbers, small evidence. This is the kind of financial performance for skeptical customers,” the source said. “A huge secular change is possible in these massive [industries]. These disruptor companies are putting numbers on the board consistent of what you would expect with public companies one day. That’s a very persuasive fact pattern.”

DCVC isn’t the only fund to lower a target or hold a final close on less capital than it expected after a tougher 2022 and 2023 fundraising cycle. Tiger Global’s latest fund raised $2.2 billion of its $6 billion target. In the first half of 2023, firms such as Founders Fund, Insight Partners and TCV all slashed their fund targets.

Fundraising got incredibly tough for venture firms across the board in 2022 and 2023. While 2022 set a new fundraising record for U.S.-based firms — $172 billion, according to PitchBook — analysts said that largely was due to funds raised in 2021 closing in 2022. The real effects were felt in 2023. U.S. firms raised $66.9 billion in 2023, according to PitchBook, the lowest total since 2017 and a 61% decrease from the record-setting year prior.

On the other hand, climate investing is one of the few hot spots, outside of AI, that’s attracting increasing VC attention and doing well for VC fundraising as well. Climate-focused VC funds have raised more than $710 million so far in 2024, according to data from Preqin, on track to match or surpass last year’s $2.17 billion raised and not far off 2022’s record of $2.9 billion.

While both LPs and analysts have told TechCrunch that they aren’t expecting 2024 to be a significantly better year for VC fundraising — some think it might be worse than 2023 — for DCVC’s new climate fund, things may actually be headed in a better direction than its recent SEC disclosures have indicated.


Software Development in Sri Lanka

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