Written by Shannon Hobbs & Antoine Pradayrol, 4th September 2023
In this year alone Green Angel Ventures has been recognised for its commitment and excellence in the fight against climate change. We won Early Stage Investor of the Year at The Business Green Awards, Seed VC of the Year at the UKBAA Awards, and we were recognised as the the third-most active angel network in Europe by Sifted.
As part of being a leader in investing in UK climate innovation, every six months we publish our carbon impact report.
158,000 tonnes of CO2e avoided to date
We calculate and report on the cumulative total of the greenhouse gas emissions saved thanks to the activities of our portfolio companies. To date we have invested over £36m into 41 exciting start-ups in the climate space. Our accelerating deployment runs in parallel with our increasing impact, and we are pleased to report that as of 30th June 2023 Green Angel Ventures portfolio companies have avoided 158,000 tonnes of CO₂e being emitted! This is equivalent to taking more than 110,000 cars off the road for a year.
Introducing Three Innovative Companies in our Portfolio
Investing in early-stage businesses means that a proportion of our portfolio companies have not yet started selling their goods or services, and therefore currently have no impact. However, as a result of our investment being utilised to develop these companies, we are able to include more and more companies in each report.
In this report, we welcome three new companies that work in transport, industry and nature-based solutions:
- 3ti Energy Hubs – 3ti is a new portfolio company that turns car parks into renewable energy-based EV charging hubs. Their easy-to-install product, Papilio3, combines solar PV, batteries and fast EV charging points into a novel infrastructure. The company produces renewable-based electricity, therefore contributing to the decarbonisation of the UK grid.
- Alusid makes beautiful tiles from recycled glass and waste porcelain, and the production of those saves significant quantities of resources and energy, hence CO2. We have included Alusid in our calculation on the back of the company’s recent commercial launch with Topps Tiles.
- NatureSpace Partnership has developed a better way of granting property developers planning permission in areas that contain the protected great crested newt. We have now integrated a method to account for the beneficial carbon impact of their activity – see below.
The impact of the cost of living crisis
It is fantastic to see that our impact continues to grow over time. Although the emissions saved continue to climb, we did note that the rate of acceleration decreased in the first half of 2023.
We attribute this to the current economic climate, which is characterised by the cost of living crisis we are all facing today. Indeed, some of our B2C-oriented portfolio companies have experienced a softening in sales in the first half the year, as we all cut back on our spending.
The underlying need for climate solutions is as strong as ever
The economy may be slowing down, but climate change is doing quite the opposite. Leading scientists are certain that extreme weather, biodiversity loss, rising sea levels and ocean acidification will worsen, whilst the window for climate action narrows.
In this context, the market for early stage companies developing solutions to the climate crisis is also expanding at an accelerating pace – and we see that, despite the economic downturn, many of our portfolio companies are seeing rapid growth. This is the core of our investment thesis, which, is stronger than ever: companies making the biggest carbon impact will make the biggest financial returns
Carbon Impact by Sectors
By breaking down our portfolio companies into sectors, we can see that the largest contributions of our investments are from buildings, energy and transport.
For the first time, energy no longer makes the largest sectoral contribution, but has been surpassed by buildings. Of course, energy remains one of the key sectors we must decarbonise to mitigate climate change, but its lower proportional impact is encouraging for several reasons.
Firstly, renewable energy is supplying more and more electricity in the UK, with the lowest ever carbon intensity being achieved in February 2022. As a foundation, we calculate the carbon impact of our energy-related portfolio companies by comparing their activities (e.g. generating low carbon energy) to the current reality, therefore if the UK energy mix is decarbonising, we would expect the impact of energy-related companies to drop.
Secondly, there has been significant growth in activity among companies operating in other sectors, who therefore are making greater contributions in saving emissions. Their growth has achieved a more balanced contribution across sectors.
Thirdly, more generally, this rebalancing is a result of the diversification of the Green Angel Ventures portfolio. We are receiving funding applications and making investments across all the key sectors that emit the most CO2e – and therefore it is no surprise that the carbon impact of the portfolio is itself becoming more broadly spread across sectors.
Examples of other significant company contributions in these non-energy sectors include:
Incorporating the carbon sequestration impact of nature-based solutions
Each company in which Green Angel Ventures invests has a unique innovative product or service to reduce emissions, and therefore each method must also be unique (as we detailed in our methodology as part of our March 2023 report).
Calculating a carbon impact for companies which are biodiversity-focused or deploying nature-based solutions has always been difficult, due to the complex and dynamic nature of ecosystems. We are happy to say that for the first time, in this report, we have included a nature-based solution company within our calculations.
NatureSpace Partnership provides habitat creation and long-term monitoring/management for great crested newts when their habitats are reduced or threatened by developments.
The carbon saving that we have calculated stems from the net carbon intake of the surplus habitat that the company creates through their scheme over time. Including NatureSpace Partnership provides a concrete, practical example of how biodiversity and climate change must be viewed and tackled in unison.
If you would like to learn more about their paramount connection, please continue your journey by joining us this Friday for our 4thought Friday session with The Rainforest Alliance.