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Startup Discovery: Disruption in Climate Change

Purpose-driven Entrepreneurship and Climate Change Startups

from the World Benchmark Report 2019 – 2020

Unless there is hope, no one takes it upon themselves to address catastrophic situations such as climate change. Global concerns such as climate change spark innovation by the most innovative people on earth, who believe they can find the tools and technology that can make an impact. The entrepreneurial spirit is alive and well, especially when it comes to addressing issues such as climate change and the environment. This article will highlight purpose-driven entrepreneurship from the World Benchmark Report 2019 – 2020, including climate change startups about to disrupt the world.

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What is Purpose-driven entrepreneurship?

A key trend in innovation around the world is purpose-driven entrepreneurship. In fact, the WBR19/20 states –

“Trying to cater to the demands of a new kind of entrepreneur that wants to ‘do well by doing good,’ entire programs have shifted to support impact-driven entrepreneurship.”

Some programs have customized their service offerings specifically for budding social entrepreneurs, becoming an anchor to positively influence the development of new technologies tempered by market mechanisms and various other challenges.

What is the World Benchmark Study?

The World Benchmark Study, now in its fifth iteration, is an in-depth look into the operations of business incubators and accelerators around the world. The study includes data provided by university-linked, public, private, and corporate programs seeking knowledge about themselves and their peers. One thing that stands out about the UBI Global community – our members love to share future-forward best practices and success stories on how to overcome the challenges faced in their particular market.

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What is the World Benchmark Report?

The World Benchmark Report 2019 – 2020 is an enlightening document that highlights the key findings from the World Benchmark Study. Think of the WBR19/20 as the narrow end of the funnel of information about programs and startups from all over the world. Incubators and accelerators of all sizes, in all types of markets, and with affiliations that ranged from university-led to public, private, and corporate supported programs are included in this exciting group. The WBR19/20 gives a picture of the data as well as offering insightful key takeaways derived from the global innovation community.

Download the World Benchmark Report 2019 – 2020 here!

Why Place Focus on Startups?

Diving into the startup companies impressive enough to be mentioned specifically by the benchmarked programs in the study is a natural fit. Value for client startups is just one portion of how a program is benchmarked. The underlying portfolio of knowledge and services offered by the benchmarked programs contributes to the global innovation ecosystem – and these are just a few of the startups making an impact.

Sustainable Development Goals and the Benchmarked Programs

This iteration of the World Benchmark Study included a special look of the programs helping to address the 17 United Nations Sustainable Development Goals (SDGs). Of the benchmarked programs, nearly half of them responded with detailed information on social incubation or acceleration related data. Client startups focused on Climate Change were reported by 23 percent of the benchmarked programs as an SDG-focused area of innovation.

Who are the programs?

With a global sample of amazing innovation to study, it was difficult to narrow down the programs and startups to focus on for this series of articles. After pinpointing the incubators and accelerators reporting climate change startups, we reached out to them for further details. While they are by no means the only climate change-focused startups being nurtured in our community, they are the most interesting and have the most potential to make an impact on our planet.

Program: EnergySpin

Program: EnergySpin 

Type: Accelerator

Focus: Energy Solutions

Client Startups Focused on Climate Change: 30%

Location: Finland

Focused on energy solutions, EnergySpin is a multi-corporate business accelerator located in the Vaasa region of Finland. The program operates two 10-week scale-up programs per year that includes 10 startup clients. Offering a portfolio that includes business support and scale-up services, EnergySpin looks for startups focused on problem-solving and industry transformation and reports that climate-focused startups account for 30 percent of their clients.

Startup Discovery: 21TDMC

Tackling the problem of waste energy, 21TDMC has developed thermodynamics that radically changes the power efficiency from everything from lawnmowers to nuclear power plants. Consider that only 12 percent of consumed fuel goes directly to its purpose – transportation, heating and cooling, street lighting, etc. – increasing efficiency with sustainable technology is a game-changing innovation.

More EnergySpin Startup Discovery: 

Instagrid, a mobile battery innovator that recently secured 8.5 million Euro in series-A funding.

Geyser Batteries, a cleantech startup focused on water-based, non-lithium batteries.

Program: YES!Delft

climate change

Program: YES!Delft

Type: Incubator

Focus: Tech

Client Startups Focused on Climate Change: 10%

Location: the Netherlands

About: One of the Top-5 University Business Incubators in the World

Download the World Rankings 19/20 Report here.

Working with a diverse client startup portfolio of early-stage companies, YES!Delft focuses on nine tech startup areas: Blockchain, AI, Biotech, Cleantech, Medtech, Edtech, Aviation, Robotics, and Deeptech. Harnessing the power of a community of experts, YES!Delft offers client startups a full-lifecycle portfolio.

Startup Discovery: Elemental Water Makers

With 70 percent of the earth’s surface covered by water, is there really a shortage due to climate change, over-use, and increasing population? The short answer is yes, and offering an answer to the problem is Elemental Water Makers. Using renewable energy, Elemental Water Makers ensure an affordable, high-quality supply of fresh, clean water.

More YES!Delft Startup Discovery:

Kitepower, addressing climate change renewable energy concerns with mobile wind energy solutions. Beyond wind turbines, Kitepower harnesses the wind in a sustainable, portable way.

Noria, a plastic waste removal innovation company on a mission to solve the environmental issue of plastic water pollution.

We can’t resist one more, Solho, an solar power source for greenhouse-based horticultural projects. Recently awarded the VIDA demonstration voucher, this grant will enable the startup to develop even further success.

Startups focused on climate change are approaching this concern from both the upstream causes and downstream effects. Leading the charge in waste management, agriculture, pollution, and energy creation, these startups are doing their part to combat climate change from a variety of different directions. Positioned strategically between the passion and ingenuity of startups and the influence and size of corporate innovation-seekers, incubators and accelerators are making sure the path to success is a smooth one for the most meaningful startups to the planet.

Challenges

Startup companies focused on disrupting technology to improve SDGs face several challenges on the path to becoming viable, successful companies. Commitment by investors, complex intellectual property rights, and global market barriers are among the daunting conditions climate change startups face. Entering an accelerator like EnergySpin or an incubator like YES!Delft gives a fledgling company tremendous benefits over a startup going it alone.

In fact, with an average 5-year survival rate of 64 percent, startups that are part of the benchmarked programs outperformed non-incubated startups by 34 percentage points. In addition to direct financial support, incubators and accelerators provide a basic business framework through a portfolio of services including mentorship, legal and accounting services, co-working space, and much more. 

Advantage: Innovation

One conclusion that is easily drawn from reading the World Benchmark Report 2019 – 2020 is that no two programs are identical. It makes our job as researchers more challenging and complex but provides a never-ending fascination for the amazing community of incubators and accelerators we study. Are you ready to activate your innovation with a deep-dive into our amazing community? 

Become a UBI Global member – participate in our lively, vibrant community ready to share best practices, ideas, and challenges. Explore the benefits of being a UBI Global member including specialized technical products through our partners, community events, and corporate matching programs. Sign up here for membership.

Activate the innovation in your corporation by harnessing the power of UBI Global data and our award-winning research team. We offer corporation – startup – ecosystem – incubator/accelerator matching customized to your terms and needs. Get in touch with us here for a free consultation.

Download the World Benchmark Report 2019 – 2020 here!

This is a time of unprecedented uncertainty; in the most dramatic and swift manner, a pandemic of as yet unknown proportion has changed the day-to-day lives of a sizeable proportion of the world’s population and wrought significant and perhaps lasting economic damage. The human toll, of course, eclipses such concerns, though it is still perhaps valuable to consider the consequences of COVID-19 on startup ecosystems globally and the ventures that reside there.

Startups are an essential part of the economic fabric of many nations, helping secure their future prosperity, and bearing multipliers – particularly in high-tech industries – that can exceed those of more established enterprises. The prolific increase in resources devoted to startup ecosystem development over the last several years indicates that governments now recognize the importance of targeting startups, and will hopefully take appropriate actions to ameliorate the worst of COVID-19’s economic effects. Though, if they do not, it may be up to founders and their champions to take decisive action and give them their best shot of survival.

Short-term consequences

In the short-run, many startups are likely to be concerned – primarily – with ensuring the safety and good health of their employees, whilst maintaining their operational capacity. Added to these concerns may be difficulties on both the demand and supply sides, with sharp contractions in consumer demand prevalent in many industries, and supply chains also coming under strain, if not breaking entirely. For those ventures not yet able to walk on their own, stock market losses and other COVID-19-related fears may prompt current backers and potential VC funding to dry up, leaving promising startups with potentially critical short- or medium-term liquidity woes.

Medium-to-long-term consequences

Though we are perhaps not yet far enough along the curve of this crisis to accurately discern its likely medium-to-long-run effects, even the most optimistic models of numerous respected institutions, including the WTO, are forecasting sharp falls in consumer and business spending that – in the medium-term – will result in a global recession and, perhaps – in the long-term, under a prolonged epidemic – a historic slump that could surpass the global financial crisis of 2008–09 and approach or eclipse the great depression. In such an event, startups that have survived the short-term effects of COVID-19 may be subjected to a more protracted malaise and contraction in consumer demand that could prove critical to startup prospects.

Sustained distress in the financial system and declining asset prices are likely to result in significant contractions in VC funding volumes, even if a full-scale banking crisis is averted because of strong bank capitalization and the macroprudential policy. A downward spiral, unabated by fiscal and monetary intervention could prove terminal to many startups that, in more ordinary times, may eventually have thrived.

Irrespective of the eventual gravity of this crisis, it will have short- and long-run consequences that entrepreneurs will be forced to navigate in order to ensure the continued survival and eventual success of their startups. There are some actions, both near-term and long-, that may give burgeoning startups the best chance of survival.

Maintain capacity

Firstly, maintaining operational capacity is important. It does not mean that things must be kept running at full capacity, particularly in the context of deficiencies in demand, rather than the core, critical functions of the firm must remain efficient and as close as possible to full-productivity. Identifying and targeting these areas, and preparing a plan to keep colleagues working remotely motivated, productive, and – crucially – in good spirits, is essential. Preparing or directing colleagues towards effective remote working tools and guides can help on the productivity front, whilst constant, calm, and high-spirited communication can help to instill a sense of confidence and aid morale. It will leave the firm better-able to respond to the challenges that will arise, quickly and decisively.

Revise plans and the numbers

Hoping for the best is not an option. Creating a credible plan that allows for the survival of the firm with minimal external funding and, if plausible, without external funding may be the key to the survival of many startups. This will require an intensive appraisal of the firm’s exposure and areas of vulnerability. Revising projected revenues and costs based on likely and worst-case scenarios will help prepare for what may be to come, and indicate which difficult choices might have to be made.

This may point, for many, to a need to diversify revenue streams. Even if this seems, on first thought impossible, deep and concerted thought must be given to ways in which current competencies can be adapted to capture future returns. Even if these plans remain thus for the foreseeable future, having at least an idea or two of what and, crucially, how different revenue streams can practically be made flow makes for sound risk management. On the supply side, considering or potentially securing supply-chain alternatives – particularly domestic ones – may be wise for some firms.

However this reappraisal takes shape, what is required now is that founders face the possibility of a graver and more protracted downturn and take actions now that they may find themselves less able to make in the future.

Securing funding

A difficult task in the best of times, securing funding in such times as these might seem a herculean one. That said, after a period of seemingly interminable pessimism and bad news, people will become accustomed to the new normal and invest. Being prepared to take advantage of these opportunities by being able to demonstrate that one’s company is robust or ¬– ideally – bears antifragility, may be key. Irrespective of the extent of the coming economic malaise, it will still be a good environment for good founders. By taking many of the aforementioned steps and minimizing reliance on external funding, conversely, startups can find themselves a more attractive proposition for VC’s dry powder later.

Government funds and other private grants may also be a valuable option to explore for funding, particularly for those in sectors that directly address health and wellness, but also those in other sectors viewed to be ‘favorably’ affected by market conditions. Foundations may also be a more speedy source of capital than equity investments. The key thing in the long-term is not giving up entirely on securing funding in the downturn.

Communication is key

As ever, good open communication can be a fundamental component of navigating this crisis successfully in the long run. Confident and transparent communication with employees, investors, and those to whom one turns for advice are wise. Keeping key stakeholders abreast of developments and part of the process can give comfort to all concerned with the company’s survival, and also help generate solutions to complex problems.

Whatever the eventual breadth of this crisis, it is important to stay hopeful. Many great companies have emerged from recessions of bear markets. With the right decision-making and a dose of good fortune, founders can make theirs the success stories of the future.

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