With the final episode of The Oprah Winfrey Show and the conclusion of the Harry Potter septology, the year 2011 was one of pivotal losses. Notable for the planet, however, was the decline of investment in the clean tech industry. From the late 2000s to 2010s, “clean tech”—or technologies powering renewable energy—exploded, with $25 billion of venture capital funding deployed at its peak. All of the trappings of an investment bubble were there: a billionaire visionary leader in John Doerr, newfound cultural concern around climate change after Inconvenient Truth’s debut, and a spate of government grants, loans, and tax breaks directed at clean tech. Ultimately, few of the startups funded during clean tech’s heyday achieved meaningful scale. But by the end of 2011, venture capital (VC) firms lost over half of their investments.
Many believe we’re experiencing a second clean tech bubble operating under a new name: “climate tech.” As President Joe Biden prepares to deploy $20 billion of federal funding toward research for climate mitigation technologies, investors, federal agencies, corporations and consumers continue to miss the point entirely. Climate leadership today does not represent the marginalized communities most impacted by climate change, and we’re far from reaching broad support for systemic solutions, like a just transition. We don’t need more shiny tech solutions promising massive disruption, rather the climate crisis is one of collective power. Failing to acknowledge this only increases the fallout should this bubble burst. Only this time, we have even less room for error.
Even if the world’s best technologists built a solution to remove all the carbon dioxide in the atmosphere tomorrow, the extractive systems that led us here still exist. We can’t simply disrupt our way out of societal collapse.
Innovation Culture and the Climate Tech Obsession
Much has been written about the culture surrounding tech startups, but fictional character Gavin Benson from HBO’s Silicon Valley captures it best. “I don’t want to live in a world where someone else makes the world a better place better than we do.” The show debuted in 2014 to a viewership of over 2 million, and marked the collision of startup culture with mainstream media. That same year, Apple unveiled the first Apple Watch, Ellen DeGeneres tweeted a group selfie that crashed Twitter, and the ice bucket challenge chilled the nation. Tech giants like Apple, Microsoft, Google, and Facebook dominated consumer tech, and social media virality became the norm.
The “hacking” rhetoric previously reserved for coding pervades public discourse. “Growth-hacking” became a coveted marketing position, and “life-hacking” is a strand of self-improvement based on the premise that humans are basically computers. Soylent, a liquid meal substitute created by former Silicon Valley engineers, capitalized on this “techie” fascination with optimization. Why eat a whole meal when you could isolate only the nutrients you need? By 2015, the Apple Watch accounted for two thirds of the global smartwatch market, driven by cultural obsession over quantifying our activity. New Apple product releases are akin to sneaker drops in the streetwear world with inventory selling out on the first day. “Techie” culture is now for everyone.
Think big, fail fast, and scale to change the world. These are the rallying cries of early innovation culture. This zeal to save the world appears tenfold in climate tech because the world is at stake. “Moonshot” climate innovation, coined by Microsoft President Brad Smith when he announced the company would go carbon negative by 2030, leads us to believe that new technology is our last hope. Who can argue with that? It was technology and government intervention that produced the internet and put a man on the moon in 1969. Climate tech feels exciting because tech startup alchemy produced entirely new markets—ride-sharing, streamable content—and disrupted old ones. However, even if the world’s best technologists built a solution to remove all the carbon dioxide in the atmosphere tomorrow, the extractive systems that led us here still exist. We can’t simply disrupt our way out of societal collapse.
Climate Tech is Everywhere
Part of climate tech’s allure is that it can be anything. AI-driven robots that sort recycling. Low-carbon personal transit pods to shake up your commute. Protective coatings that save produce from spoiling. Climate tech is a web of products and services designed to prevent further carbon emissions or capture what’s already there. While clean tech companies honed in on wind and solar power, climate tech spans transportation, food, energy, buildings, and industrial activity.
There is money to be made in fighting climate change. VC fuels the growth of startups by providing direct investments to help small companies scale. While nascent, the climate tech investor ecosystem includes VC firms and an ever-growing list of climate tech accelerator programs for startups interested in more support. Climate billionaires like Bill Gates started their own philanthropic initiatives; even major corporates like Amazon and fossil fuel players like ExxonMobil have staked their claim. However, it wasn’t until Y Combinator, an infamous Silicon Valley startup accelerator responsible for launching companies like Airbnb, announced an open call for climate tech solutions that the world took notice.
The Problem with Climate Tech Investment
More than a trend or investment bubble, climate tech relies on the belief that climate change is an innovation challenge first, and one ripe for market-based solutions. Capitalist principles assert competition as the best path to innovation. Take carbon capture technology, for instance, a proposed silver bullet that traps carbon emissions underground or channels it for use in other products. Like any startup, carbon capture companies are beholden to their VC investors, which means collaborating with “competitors” may dampen potential financial returns—and more importantly, global notoriety—if their solution succeeds.
Climate tech VCs use screening criteria like potential carbon impact, capital efficiency, and value creation to determine where to invest. Free markets can surely value social benefits but will always require financial profits; as investors, VCs still expect returns. Few climate VCs make investment decisions based solely on a startup’s impact on ecological resilience or the redistribution of economic power because that runs counter to VC investing pedagogy. When VCs invested $200 million in Beyond Meat, they stumbled upon a “unicorn”—that rare startup that eventually becomes a household name. Every VC dreams of discovering the next cash cow climate enterprise, but that cannot be the only goal.
Technocratic solutions fail to address the systemic issues that led us here—namely, prioritizing economic growth above all else. More insidious is the political, financial, and cultural attention that climate tech diverts from the most daunting task of climate change: empowering marginalized people.
Climate tech solutions that don’t address historic inequities at a systemic level don’t deserve our attention.
Invest in People, not Products
History teaches us that social movements often yield a charismatic leader to inspire others. The American civil rights movement nurtured visionaries like Marsha P. Johnson, Angela Davis, Malcolm X, and so many others. Successful movement leaders are often radicalized by systems of oppression, which allows them to empathize with their base. The disproportionate impacts of climate change on people of color is well-known, yet the network of major environmental advocacy organizations and the climate tech sphere remains laughably white in membership and workforce. The global movement for a just transition is the most comprehensive proposition to transition from high resource extraction and worker exploitation toward regenerative economies and ecological well-being. Movements work, but they need people with the capacity, training, resources—and as history proves, lived experience—to win campaigns.
Climate tech solutions that don’t address historic inequities at a systemic level don’t deserve our attention. Local farmers, growers, and stewards already hold the knowledge needed to fish sustainably, improve soil health, and regenerate forests. Imagine if the financial infrastructure upholding climate tech were redirected toward human capital. Instead of accelerating new climate startups, incubate the next generation of climate activists. Biden’s $20 billion research investment would be better spent fueling global climate justice advocacy efforts that otherwise go underfunded. The capital is already out there. But where we channel our resources matters.