In looking for climate-adaptation startups to invest in, I’ve struggled to define exactly what is and what is not an adaptation business. Do alternative meat and milk startups count? How about platforms to manage power from renewables?
How I’ve been categorizing climate adaptation startups
My framework so far has focused on known climate changes and areas of human life that are impacted. So I’ve looked for startups at the intersection of drought and agriculture, or general instability and migration. You can see it below; it’s crowd-sourced and always changing. Feel free to contribute your ideas and startups here (darker green means I’ve found more startups in this area; lighter means fewer):
ASAP’s Adaptation Solutions Taxonomy
Since my framework is far from perfect, I’m glad to see this great paper by the Adaptation SME Accelerator Project, called Adaptation Solutions Taxonomy, released just a month ago. Here’s a snapshot of how they’re defining adaptation businesses (specifically small businesses / startups), and you can see the whole paper here:kamagra medicine
Very broadly, ASAP’s paper splits adaptation plays into two arenas: 1) tracking changes and 2) everything else. But when filtered through a few more requirements, the world of adaptation plays narrows considerably.
I struggle with the language of papers like these – they feel like they’re written by a committee (which this one technically was) – but that doesn’t mean the content is wrong.
Challenges I see in executing on the ASAP framework for climate adaptation startups
As an investor who is actively putting dollars and time into companies for my own portfolio, and with the long-term goal of launching a larger fund on the same thesis, I see some challenges putting the framework into action:
- Developing Markets. As an early-investor in adaptation companies, I want to see fast growth and early traction, as well as positive unit economics in the first two or three years of the business. Without these things my companies might not survive, and that means in the early years of the business, they often have to focus on wealthier countries. In markets like Bangladesh, positive unit economics can be hard to find because people and businesses are super price sensitive. Furthermore, budgets often don’t exist for measurement and early adaptation. So Chittagong, Bangladesh can’t spend the same amount as Houston, Texas or Miami, Florida on resilience or adaptation efforts.
- Qualitative / Quantitative Measurements. It’s hard to hold a startup accountable for a qualitative or quantitative impact until their model is validated and can scale. Most successful companies pivot and transform their way to success. Early investors are backing the intention of the founder over business’s actual impact.
Nonetheless, creating a taxonomy is deeply important to get collective agreement on what it is we’re all talking about. I’m sure this evolving process will remain wet paint for a long time to come.
If you’re interested in working with me to source and co-invest in adaptation startups, please reach out using the Contact form. I’m based in Hong Kong.