Five years on:

global climate tech investment

trends since the Paris Agreement

October 2021
 Foreword
As global leaders gather at COP26 for the most important climate summit since the Paris Agreement, all eyes are on Glasgow and the UK.
This is a pivotal moment which requires the entire global economy to change business practices and commit to net zero emissions to
help limit global temperature rises to 1.5C by the middle of this century.

The role of the global tech industry is critical to address the climate crisis. As a driving force of innovation, creativity and making the impossible
possible, technology is essential to enable and accelerate transformation at the scale and pace required. Since the Paris Agreement, we have seen
exceptional growth in the number of climate tech companies globally - those working to reduce or eliminate greenhouse gas emissions and address
the impacts of climate change. We have also witnessed VC investment into climate tech solutions skyrocketing, with global investment growing by
almost five times since 2016.

Europe has likewise seen rapid acceleration of climate tech VC investment and global tech hubs like London, Stockholm and Paris are driving this
exceptional growth. Europe is one super connected tech ecosystem and in order to really drive progress, we need cities to work together to spark
ideas, share knowledge and scale solutions.

Home to the biggest cluster of climate tech companies in Europe, London is determined to be a global leader in taking action to meet global climate
commitments. It is one of the first cities in the world to publish a climate plan compatible with the highest ambition of the Paris Agreement. London’s
ambition to become a net zero carbon, zero pollution and zero waste city is backed by a strong strategy, targets, infrastructure and finance and
demonstrates its commitment to being the city of the future, today.

This report explores global investment and startup trends in climate tech since the signing of the Paris Agreement at the pivotal moment of COP26.
With a focus on Europe and London, the report reveals how much investment is going into climate tech, which sub industries are attracting the most
investment and where potential future growth lies.

It is clear that investment into climate tech is growing fast, and that demand is only going to accelerate further. With global and local governments,
private sector, investors and entrepreneurs working towards a common goal, we have the best chance of tackling the global climate crisis.

Lucette Demets, Head of Sustainability at London & Partners

Page / 2
Key takeaways

Climate tech is booming globally London is a climate tech London has great potential for
powerhouse future growth

Since the signing of the Paris Climate London is one of the driving forces behind The growth of climate tech is been driven
Agreement, global climate tech Europe’s rapid growth in climate tech. Its by significant global investment into areas
investment has skyrocketed, with five startups raising $3.3B in VC investment such as transportation, energy and
times more VC funding in 2021 than 2016. since 2016, 16% of Europe’s total. circular economy solutions.

2021 has been a record year for climate With a thriving climate tech ecosystem, London is the second city globally for the
tech investment, with $32B raised so far London is home to 416 climate tech number of climate tech rounds raised by
this year. companies - more than any other startups, suggesting an active ecosystem
European city. with significant growth ahead.
Europe is the fastest-growing region
globally for climate tech, with investment The UK capital is also a hub for climate Climate tech companies in London are
growing faster than the global average: tech funds, with London-based VCs raising scaling - the city is home to 3 climate tech
7.0x vs. 4.9x between 2016 to 2021 year to over half of Europe’s dedicated climate unicorns and 6 potential future unicorns.
date. tech funds in the last two years.

Page / 3 In this report, 2021 YTD covers data up until Q3 2021.

Table of contents

Regional analysis

London overview

Sector overview

Page / 4
 Regional Analysis

Page / 5
Climate tech startups have raised a record $32B in 2021 globally, 4.9 times more
investment since the Paris Climate Agreement was signed five years ago.

Global climate tech investment Biggest rounds of 2021 YTD

▊ $0-1M (pre-seed) ▊ $1-4M (seed) ▊$4-16M (series A) ▊$16-44M (series B) ▊

Company HQ Transaction
$44-110M (series C) ▊ $110-275M ▊ $275M+

$32.3B Stockholm $2.8B

$33B
Sweden Growth Equity
4.9x
Irvine $2.5B
United States Growth Equity
$21B
$22B
$18B $17B
Boading $1.4B
China Growth Equity

$11B $9.6B Roseville $800M

$6.6B United States Late VC

Carson City $700M

Materials
United States Series C

2016 2017 2018 2019 2020 2021 YTD

Page / 6 In this report, 2021 YTD covers data up until Q3 2021. Source: Dealroom.co.
European climate tech startups have been leading investment growth,
attracting a growing share of the global capital in the space.
Global climate tech investment per HQ region Biggest rounds of 2021 YTD in Europe

▊ Europe ▊ USA & Canada ▊Asia ▊Oceania ▊Africa ▊South America Company HQ Transaction

100%
11%
Stockholm $2.8B
14%
22% Sweden Growth Equity
31%
38%
75% 51%
Paris $335M
France Series D

54% 61% 57% Vilnius $275M

50% Lithuania Series F
44% 54%
32% Bruchsal $241M
Germany Series D
25%

23% 26% 28%

Paris $210M
18% 16% France Series D
15%
0%
2016 2017 2018 2019 2020 2021
YTD

Page / 7 In this report, 2021 YTD covers data up until Q3 2021. Source: Dealroom.co.
Europe is now the fastest growing region for climate tech, with investment
growing 7 times since 2016.
Climate tech investment per HQ region

$17B
$17B

5.8x

$11B
$11B

$8.5B $8.4B
7.0x $8.0B 1.7x

$5.0B
$5.5B $4.8B
$4.5B
$4.1B
$3.6B $3.5B
$2.9B $2.8B
$2.3B $2.5B $2.1B
$1.1B $1.4B

2016 2017 2018 2019 2020 2021 YTD 2016 2017 2018 2019 2020 2021 YTD 2016 2017 2018 2019 2020 2021 YTD
USA & Canada Europe Asia

Page / 8 In this report, 2021 YTD covers data up until Q3 2021. Source: Dealroom.co.
The UK ranks 4th globally for climate tech investment, with London-based
startups receiving over 70% of UK funding.

Total VC investment per HQ country 2016 to 2021 YTD Total VC investment per tech hub 2016 to 2021 YTD
combined combined

United States $48B Bay Area $19B

China $18.6B Shanghai $7.8B

Sweden $5.8B Greater Los Angeles $6.8B

United Kingdom $4.3B Stockholm $5.4B

France $3.7B Beijing $4.3B

Germany $2.7B London $3.3B

Canada $1.4B Greater Boston Region $3.0B

Netherlands $1.3B Paris $2.3B

India $1.0B New York $2.0B

Singapore $0.7B Hangzhou $1.3B

Page / 9 In this report, 2021 YTD covers data up until Q3 2021. Source: Dealroom.co.
 London Overview

Page / 10
Climate tech investment into London has already surpassed $1B in 2021,
growing 6.3x since 2016, faster than the global average (4.9x).
Climate tech investment into London startups Biggest rounds in 2021 YTD

▊ $0-1M (pre-seed) ▊ $1-4M (seed) ▊$4-16M (series A) ▊$16-44M (series B) ▊ Octopus Energy $600M Growth
Clean energy supplier Equity
$44-110M (series C) ▊ $110-275M ▊ $275M+ September

Newcleo $118M Early VC

$1.2B Nuclear fission energy August

$1.1B Highview Power $70M Growth

$1.1B Cold energy storage Equity
February
6.3x Olio $43M Series B
Distributes soon-to-expire food September

Carbon Clean Solutions $30M Series B

Direct air capture July
$550M $473M
Cervest $30M Series A
Climate risk platform May

$254M Circulor $14M Series A

$176M Responsible sourcing June
$143M
THIS $13M Series E
Plant-based meat June
2021
2016 2017 2018 2019 2020
YTD

Page / 11 In this report, 2021 YTD covers data up until Q3 2021. Source: Dealroom.co.
The combined value of London climate tech startups has almost tripled in
the last year alone, thanks in large part to big exits from Arrival and Depop.

Combined enterprise value of London climate tech startups

▊ $0-250M ▊ $250-1.0B (Future unicorn) ▊$1.0-10B (Unicorn) ▊$10B+ (Decacorn)

$44B
$28B

2.9x
$22B

$9.5B
$11B

$2.1B $3.2B
$960M $1.4B

2016 2017 2018 2019 2020 2021

YTD*

Page / 12 In this report, 2021 YTD covers data up until Q3 2021. Source: Dealroom.co.
London leads in Europe for the number of climate tech startups.

Cumulative number of climate tech startups created per tech hub Selected newly founded London climate tech startups

London 416 Startup Launch date Description

Copenhagen 229
Newcleo 2021 Nuclear fission energy
Stockholm 197
Abatable 2021 B2B carbon offsets
Berlin 193

Amsterdam 167 Incube 2020 Modular construction

Paris 141
Carbon negative
SKOOT 2020
lift-sharing
Helsinki 121

Oslo 91 Climate X 2020 Climate risk analytics

Munich 51
Minimum 2020 B2B carbon offsets
Zurich 48

Page / 13 Source: Dealroom.co.

London is also the second city, globally, for number of rounds raised by climate
tech startups, suggesting an active early-stage ecosystem.
Climate tech rounds per HQ city
2016 2017 2018 2019 2020 2021YTD
Bay Area 70 48 98 91 92 69

London 31 31 26 54 65 40

Berlin 9 19 12 18 17 24

New York 14 24 19 17 18 22

Greater Boston Region 8 21 20 18 21 18

Greater Los Angeles 13 19 23 16 21 17

Stockholm 12 15 22 27 17 16

Paris 19 19 18 14 24 10

Houston 2 8 6 11 2 6

Munich Metropolitan Area 10 10 10 9 15 6

Page / 14 In this report, 2021 YTD covers data up until Q3 2021. Source: Dealroom.co.
London is producing a number of fast-growing climate tech companies,
home to 3 climate tech unicorns and 6 potential future unicorns.

Number of climate tech unicorns per city Number of potential future climate tech unicorns per city

Bay Area 23 Bay Area 39

Greater Los Angeles 13 Greater Boston Region 12

Shanghai 5 Greater Los Angeles 7

New York 5 Stockholm 6

Paris 4 London 6

London 3 Paris 5

Hangzhou 3 New York 3

Beijing 2 Beijing 2

Greater Boston Region 2 Shanghai 1

Stockholm 1 Hangzhou 1

Page / 15 Source: Dealroom.co.

London is amongst the leading hubs for climate tech globally, with high levels of
investment, dedicated climate tech VC funds and a thriving startup ecosystem

Greater Los Greater Boston

London Stockholm Beijing Bay Area
Angeles region

Climate tech
investment since $3.3B $5.4B $6.8B $4.3B $3.0B $19B
2016

Number of climate
tech rounds since 247 109 109 22 106 468
2016

Number of climate
tech startups
416 197 76 10 82 349

Combined value of
climate tech startups
$28B $18B $60B $24B $13B $941B

Dedicated climate
tech VC firms
18 3 4 / 14 35

Page / 16 In this report, 2021 YTD covers data up until Q3 2021. Source: Dealroom.co.
London-based VCs have raised over half of all European dedicated
climate tech funds in the last two years.

Amount of climate tech funds raised by VC firms Largest climate tech funds raised up until Q3 2021

▊ London ▊ Europe
Name HQ Fund size
$2.0B

London $900M

$1.5B
$671M
London $312M

$1.0B
Zurich $200M
$1.2B
$1.2B
$0.5B Stockholm $138M

$460M
$84M $224M Malmö $96M
$132M $64M
2016 2017 2018 2019 2020 2021

Page / 17 In this report, 2021 YTD covers data up until Q3 2021. Source: Dealroom.co.
 Sector Overview

Page / 18
On a global level, energy and transportation startups attract over 80% of
climate tech funding.
Share of investment raised by global climate tech startups per sector
▊ Energy ▊ Food ▊ Transportation ▊ Enterprise Software ▊ Circular economy

2016 2017 2018 2019 2020 2021 YTD

Circular economy is an umbrella term under which we include startups working in the fashion and home living industry as well as a wide set of marketplaces companies in second hand,
Page / 19 refurbished product segments. In this report, 2021 YTD covers data up until Q3 2021. Source: Dealroom.co.
In London, energy startups are attracting the most climate tech investment,
with circular economy and enterprise software gaining a great share.
Share of investment raised by London climate tech startups per sector
▊ Energy ▊ Food ▊ Transportation ▊ Enterprise Software ▊ Circular economy

2016 2017 2018 2019 2020 2021 YTD

Circular economy is an umbrella term under which we include startups working in the fashion and home living industry as well as a wide set of marketplaces companies in second hand,
Page / 20 refurbished product segments. In this report, 2021 YTD covers data up until Q3 2021. Source: Dealroom.co.
There is an emerging pipeline of climate tech startups in London
across the most important sectors.

Food Energy Transportation Enterprise software Circular economy1

Distributes soon to expire food Clean energy provider Electric vans manufacturer Climate risk platform Marketplace for second-hand

Total funding: $51M Total funding: $1.2B Total funding: $631M Total funding: $35M Total funding: $100M
Valuation: $171M - $259M Valuation: $4.6B Valuation: $8.3B Valuation: $120M - $180M Valuation: $1.6B
Launch year: 2015 Launch year: 2015 Launch year: 2015 Launch year: 2016 Launch year: 2011

Rising stars: Rising stars: Rising stars: Rising stars: Rising stars:

1. Circular economy is an umbrella term under which we include startups working in the fashion and home living industry as well as a wide set of marketplaces companies in second
Page / 21 hand, refurbished product segments. Source: Dealroom.co
What is your mission?

Tessa Clarke
Our mission is to reduce food waste in the home - at
scale - by leveraging the power of digital technology and Co-Founder and CEO
local communities. We do this by connecting people to
their neighbours, and volunteers to local businesses, so
that surplus food and other household items can be HQ: London
given away, not thrown away. Our vision however is Booker, Compass Catering and many more to have zero Founded: 2015
much larger than this – we want to completely reinvent food waste locations. Founders: Tessa Clarke and Saasha
how people consume by making it hyper-local and
Celestial-One
sustainable. The next step is the launch of a new We do this thanks to our 30,000+ trained volunteers – Funding: $51M
‘Borrow’ section which will connect neighbours to lend Food Waste Heroes we call them – who collect unsold
and borrow everyday household items. food at the end of the day, and redistribute it to their
local community via the OLIO app.
You saw a huge surge in new users during the
OLIO connects neighbours with each
pandemic – over half of your 5m users – why do you How has London supported your growth?
think this is and what does the future look like? other and with local businesses so
The very first OLIO pilot took place in 5 postcodes in
We experienced hockey-stick growth during the surplus food can be shared, not
North London in 2015, and ever since then London has
pandemic, both in terms of user numbers, but also in played an integral role in getting us to where we are thrown away. This could be food
terms of the number of businesses wanting to work today! We’ve benefitted from programmes such as the
with us. That’s because we collectively woke up to the Mayor of London’s International Business Programme – nearing its sell-by date in local stores,
importance of food, the power of community, and the which took us on an incredibly helpful & inspiring trade
spare home-grown vegetables, bread
urgency of the climate crisis; plus we were increasingly mission to Silicon Valley - and Tech Nation’s Upscale; as
living and working at home, which made OLIOing well as the rich ecosystem of events, investors and from your baker, or the groceries in
(neighbour-to-neighbour sharing) much easier. peers which have enabled us to learn fast and unlock
funding. London is also leading globally in the emerging your fridge when you go away. For
As we look to the future we’re particularly excited by tech 4 good and impact spaces, so it’s been brilliant your convenience, OLIO can also be
the potential for our Food Waste Heroes Programme, having that support as we’ve been breaking new
which enables businesses such as Tesco, Pret a Manger ground. used for non-food household items
too.

Page / 22
 Tell us more about The Arrival Microfactory and its
What made you choose to found Arrival here?
advantages

Arrival is a global tech company, accelerating the mass

Production takes place in rapidly scalable, small-footprint
adoption of EVs worldwide, and it made perfect sense for us
Microfactories which are located near to demand, creating
to set up a London HQ. The UK is a key location for us, with
local jobs, using local supply chains and paying local taxes,
our R&D Facility based in Banbury, and our first UK
ensuring huge regional benefits for communities around
Microfactory currently undergoing fit-out in Bicester,
the world, and reducing the impact of global shipping to HQ: London
Oxfordshire.
further increase sustainability. Founded: 2015
London and the UK have an incredibly strong talent pool in
Founder: Denis Sverdlov
Decentralising production brings economic benefits to a
tech, automotive, software, hardware, and many other Funding: $631M
much wider range of communities and regions than the
disciplines who have created brilliant innovations for Arrival, traditional automotive manufacturing approach and due to
such as our unique composite material - developed in the small footprint required for a Microfactory, reduces its
Oxfordshire - which is recyclable, doesn’t require painting, environmental impact significantly too.
and is more durable than steel: a game-changer in terms of
vehicle design and production. In addition, we have also been This local approach also enables Arrival to create products Using a revolutionary new method of
able to attract excellent global talent to the business through designed for local requirements, creating the right product
the visas available to us. for the right country so they don’t have to make any design, Arrival creates electric
unnecessary compromises and can provide their people
What are your future plans following your recent SPAC with the best possible mobility experience.
vehicles that elevate the everyday,
IPO?
empower local communities and
Why did you choose to expand into the US?
We are laser focused on execution. We’ve been building up unlock true sustainability.
capabilities for the past 6 years, with over 2,000 employees Before announcing our US headquarters in Charlotte,
and our Microfactories currently undergoing fit out in the US North Carolina, we were already working with a number of
and UK. partners in the states. It is an important market for us and
one where we’ve had a huge interest from fleet operators
and cities to help them accelerate the transition to electric
vehicles. For instance, we have a strong partnership with
Avinash Rugoobur the City of Charlotte, who have signed an MOU with us,
President which demonstrates our shared vision, guiding principles,
and goals to improve sustainability efforts and reduce
greenhouse emissions.

Page / 23
What makes Crate to Plate unique? Sebastien Sainsbury
CEO
Hydroponic vertical farming has proven to have
essential advantages over traditional farming methods,
allowing Crate to Plate to grow produce locally in urban
environments. This approach uses minimal water (95% HQ: London
less than farming with soil), with little space required. Founded: 2020
Hydroponics and urban farming are still a relatively new Why did you choose to set up Crate to Plate in
Founder: Sebastien Sainsbury
initiatives in the UK and we are unique because we London?
Funding: Undisclosed
offer a wide variety of produce that can grow in any
single one container, rather than the traditional In the UK, over 80% of fruit and vegetables are grown in
hydroponics which focused mainly on microgreens. We Europe and imported. We saw a huge opportunity to
also have a direct to consumer business, as well as harness our knowledge through extensive R&D in Crate to Plate is a London-based
supplying restaurants and retailers. Florida and bring hydroponic farming to London. The
UK and London have exceptional regeneration projects urban farming business bringing
Tell us more about the “15-minute cities” concept and the food production element is vital. We can utilise
sustainable, local production of leafy
and the role of Crate to Plate to achieve this. this land and tech and innovation to future-proof the
farming industry. greens to urban communities. Crate
The 15-minute city is all about improving quality of life
What are your future plans?
to Plate harnesses state-of-the-art
by creating cities where everything a resident needs can
be reached within a 15-minute walk of home. Crate to hydroponics technology and
Plate supplies a wide range of super fresh organic Crate to Plate has an ambitious UK expansion plan and
lettuces, leafy greens and herbs to local residents, we have new farms opening soon in Stratford and eco-friendly innovation – to grow the
London’s Michelin star restaurants like Hide and Kentish Town. We hope to have 100 container farms
freshest possible produce, totally
retailers like Fortnum and Mason. I want everyone to be around London in the near future and we have a strong
able to get fresh leafy greens no more than a mile away pipeline of different urban spaces including rooftops chemical and pesticide free.
from where they live. Being based in unused land in the and basements. We also have plans to expand to other
urban environment means we are able to get to UK cities like Manchester and Birmingham as well as
customers as quickly as possible, in the most international expansion.
sustainable way.

Page / 24
The last 18 months have had a huge impact on every level of Rebecca Dibb-Simkin
society – how has the pandemic affected Octopus Energy? Global Director for Product
The pandemic has had a tremendous impact on people's’ lives
and Marketing
and the economy, but given our digital nativeness, we were able
to get out of this storm stronger than we entered it. We’ve Tell us more about the Octopus Centre for Net Zero and
always been a completely digital company, with our whole why you chose to base this in London. HQ: London
customer service platform and way of working housed on the Founded: 2015
cloud. So when lockdown hit, we asked our team to take their London is a global city with access to many great universities, Founder: Greg Jackson
laptops home on the Friday, and were 100% remote working on think tanks, scientists and researchers, it’s also Europe’s leading
the Monday. Funding: $1.2B
technology hub. The Centre for Net Zero looks at how digital
technology can drive net zero and the decarbonisation of heat
Since then, Octopus has gone from strength to strength, almost and transport, so a strong tech sector with access to world
tripling our employee numbers, and doubling our customers in a leading research and talent was vital to establishing a research
year that was very difficult for many businesses. We also house like this.
The energy industry in Britain is ruled
expanded across the globe, opening in Japan, US, Germany,
Spain and New Zealand and we launched our own renewable by a handful of complacent
What are the biggest future challenges and opportunities
generation business. We’ve had 18 incredibly exciting months for Octopus Energy and the clean energy sector?
and we can’t wait to see what we’ll achieve in the next 1.5 years.
dinosaurs peddling fossil fuels,
Energy is a $2 trillion dollar market still undisrupted by pricing trickery and poor customer
You recently secured significant backing from AI Gore – technology. There is a huge opportunity for entech pioneers
what are your future plans? like Octopus to bring innovative technology to markets that service. In 2016, Octopus entered the
have been underserved and stagnant, turbocharging the green
The investment from Generation Investment Management, energy revolution. market to disrupt the status quo with
which is chaired and co-founded by Al Gore, will be used to
supercharge our mission to offer cheaper green energy across Octopus Energy has been in operation for almost 6 years now, energy that's good for the planet,
the world. We’ve already used two previous successful funding and is already valued at over $4bn. This proves that there is a
rounds to expand to 11 additional countries, and we’ll be able to strong demand for the solutions we’re creating, and we’re just good for your wallet, and, honestly,
go even further with this newest one. at the beginning. Green energy will change our future forever —
it’ll be bigger than the internet.
good for your soul.
The investment will help us drive the decarbonisation of heat
through our heat pump R&D and training centre, clean up our
roads with electric cars and green hydrogen for HGVs, and build
and manage more renewable generators. We will help the world
use technology to make energy cheaper and greener, faster.

Page / 25
 What is climate tech?

We consider an impact startup to be a

company addressing one or more of the UN Reducing
Sustainable Development Goals1. harm
Environmental, Social and Corporate
In this report, we refer to climate tech Governance (ESG)
startups as companies that are applying Doing
technologies to reduce Green House Gas good
(GHG) emissions or addressing the impacts of Impact
climate change2.
Doing
environmental
Impact and climate tech both sit within a
good
broader framework of Environmental, Social
and Corporate Governance (ESG) which seeks
Climate
to reduce the harmful impact of business. Tech

In this report we examined over 5,100

global climate tech startups.

Page //26
Page 26 Source: dealroom.co 1) Methodology & definitions 2) We share PwC’s definition of Climate Tech | Source: dealroom.co
Venture capital methodology and definitions.

Startups, scaleups, Venture capital investment Accelerators and workplaces Valuation

grownups and tech
Investment numbers refer to rounds Fixed-term, cohort-based programs that The combined valuation of the tech
Companies designed to grow fast. such as Seed, Series A, B, C, …. late include seed investment, connections, ecosystem is based on their market
Generally, such companies are stage, and growth equity rounds. sales, mentorship, educational cap or latest transaction value.
VC-investable businesses. Sometimes components and culminate in a public
they can become very big (e.g. $1B+ Venture capital investment figures pitch event or demo day to accelerate Transaction value is realized from
valuation). exclude debt or other non-equity growth. exit or implied unrealised valuation
funding, lending capital, grants and ICOs. from the latest VC round, which is
When startups are successful, they We consider an accelerator as an either announced or estimated by
develop into scaleups (>50 people), Buyouts, M&A, secondary rounds, and ‘investor’ since it takes equity from its Dealroom based on benchmarks.
grownups (>500 people) and result in IPOs are treated as exits: excluded from startups whereas a ‘workplace’ does not
big companies, like Arrival or funding data. take equity from its tenants.
Northvolt.
Investment rounds are sourced from In this report, co-working spaces, shared
Only companies founded since 1990 public disclosures including press office space that also offer community
are included in this report. releases, news, filings and verified support, are considered as part of
user-submitted information. workplaces.

Page / 27 Source: Dealroom.co.