A year ago, we published GAS’ inaugural portfolio impact assessment, calculating for the first time the amount of greenhouse gas emissions that are being avoided thanks to our portfolio companies. Last October, we released our first six-month update, and this is our third edition – our impact report for the second half of 2020.
Green Angel Syndicate is the UK’s angel syndicate specialising in tackling global warming and climate change – and we therefore measure our impact in terms of the quantities of carbon dioxide (and other greenhouse gases) that have not been emitted into the atmosphere thanks to the activity of our portfolio companies.
Once more, we are proud to report that the CO2e emissions mitigations enabled by the GAS portfolio companies have more than doubled over the past six months – now surpassing 20,000 tonnes, cumulatively, since early 2018.
We are acutely conscious that this remains a tiny number, compared to the scale of global or UK emissions – but this is a number that is growing rapidly, despite the pandemic, driven by the expansion of our portfolio and by the commercial development of the companies themselves.
Calculating such an impact is a complex task. We know that our calculations are simplistic, and probably inaccurate in many ways (a criticism that applies equally to the accepted calculations made of UK and global emissions). Our calculations are based on the best research and sources we could find, including of course the companies’ reports themselves when available.
On 15 February 2021 we closed the first cohort of our new EIS/SEIS Climate Change Fund. The successful launch of the Fund means that GAS will be able to deploy more capital into each investment, increasing the funding available to portfolio companies, and therefore helping them to accelerate their impact on global warming and climate change.
20,000 tonnes of CO2e avoided
Green Angel Syndicate invests exclusively in businesses with a direct impact on global warming and climate change – so each one of our portfolio companies must be developing a product or service that helps cut greenhouse gas emissions, or restore and regenerate degraded ecosystems on which we depend for CO2 removal.
The ways they do that vary widely from one sector to another, from one business model to another. Some help decarbonise transport, by fostering growth in zero emissions mobility and displacing polluting fossil fuel-based transport. Others make products in more resource-efficient ways, for example by recycling plastics or building materials to make valuable new objects whilst emitting less greenhouse gases. A number of companies are engineering or deploying solutions to enable the transition to 100% renewable electricity. Finally, some help protect or restore the natural environment – which plays an essential role in removing carbon from the atmosphere.
Adding all these different types of contributions from our portfolio companies, we are proud to report that the amount of greenhouse gas emissions avoided thanks to their activities has now passed 20,000 tonnes.
Cumulative CO2e savings from GAS portfolio companies
This figure has continued to increase rapidly, up another 88% in the past six months, reflecting the expansion in the commercial activity of many of our portfolio companies and also in the number of companies in our portfolio (24 as of the end of 2020, up from 17 at the end of 2019).
Of course, 20,000 tonnes of CO2e is a tiny number, compared to global greenhouse gas emissions (c. 51 billion tonnes pa), or even to UK-wide emissions (c. 350Mt in 2019). It is the equivalent of taking just 7,000 cars off the road for a year – better than nothing, but still very small. This is because our portfolio companies are early stage businesses, and so their commercial activity is only nascent. As their revenues grow, so will their impact – and this is already happening quickly. An essential requirement of effective innovations in the battle against global warming and climate change is rapid transition to global scale, to achieve global impact on global warming as quickly as possible. Climate change is not waiting for us, it’s happening now.
Energy and transportation remain the largest contributors
Company-by-company figures are commercially sensitive so we only report on a sector by sector basis, aggregating the contributions from companies in each broad sector of the economy.
During H2 2020, we calculate that GAS portfolio companies’ impact mainly came from the energy sector (48%) – with notable contributions from Zeigo, Piclo, Rovco and Powervault. This is followed by transportation (34%) – with growing contributions from Swytch, Betterpoints and Zedify. The two other sectors are buildings (12%) – Shields Energy, Airex – and recycling (7%) – including Thrift+, Smile Plastics and Good Club.
Sector contributions to CO2e savings in H2 2020
Compared to our impact assessment update published last October, we have left most of our company by company calculation methods unchanged – and you can read more about them in our first and second blog articles on the subject.
This time, the only significant change is the addition of a contribution from Good Club, thanks to the help of the company, which has estimated the reduction in CO2 emissions enabled by its introduction of reusable delivery boxes instead of single-use cardboard boxes – Good Club estimates this will save 20kg of carbon over the lifecycle of a reusable box.
Compared to our impact assessment update published last October, we have left most of our company by company calculation methods unchanged – and you can read more about them in our first and second blog articles on the subject.
This time, the only significant change is the addition of a contribution from Good Club, thanks to the help of the company, which has estimated the reduction in CO2 emissions enabled by its introduction of reusable delivery boxes instead of single-use cardboard boxes – Good Club estimates this will save 20kg of carbon over the lifecycle of a reusable box.
Of the 24 portfolio companies, there are five for which we have not yet developed a method to evaluate their contribution in terms of CO2e emissions reduction or CO2e removal. These are:
- The four businesses active in the monitoring, protection or restoration of ecosystems (NatureSpace Partnership, NatureMetrics, Bunloit and Scottish Bee Company). They definitely contribute to fighting global warming, as we depend on these ecosystems for CO2 removal, but we have not yet put a number on their benefits in terms of carbon.
- BuyMeOnce, which promotes and sells long-lasting products, and thereby helps reduce over-consumption of resources and carbon emissions, but we have yet to quantify its carbon impact.
In addition, four companies are not at commercial stage yet: they are developing their products and might be starting to sell them for small trials, but not at sufficient scale to have a positive impact in reducing greenhouse gas emissions.
As such, the 20,000 tonnes overall figure is the sum of the CO2e emission reduction that we have calculated for the 14 most advanced companies for which we have defined a method linking their sales to a reduction in carbon emissions. These are Powervault, Naked Energy, Rovco, Piclo, Zeigo, Shields Energy, AirEx, Swytch, BetterPoints, Zedify, Smile Plastics, Thrift+, Good Club and StormHarvester.
Beyond CO2e
What GAS portfolio companies have in common is their contribution to cutting carbon emissions – but this should not hide the fact that they are a very diverse group of businesses, active in many different sectors and with very different models – from Betterpoints’ behaviour change app to Rovco’s subsea surveying technology or NatureMetrics’ biodiversity monitoring solution.
Not all positive environmental impacts can be directly captured in one CO2e mitigation number. It is therefore useful to show the other forms of impact that our portfolio businesses make – and we have continued to benchmark them against the UN’s Sustainable Development Goals. As in our previous update, we have found that, as a group, our portfolio companies address 10 of the 17 SDGs, with a particular focus on resource efficiency, renewable energy, sustainable consumption and water. These four SDGs are being addressed by six or more portfolio companies.
Matching GAS portfolio companies with UN Sustainable Development Goals
Estimating the environmental impact of an angel investment portfolio is difficult, given the variety of companies and diversity of business models, in many different sectors. There is no well established methodology to evaluate CO2e mitigation generated by such early stage businesses. However, we are determined to continue refining our methodology and reporting on our impact every six months – because measuring our impact is at the core of what Green Angel Syndicate is about.