Climate software startups have raised around $1.3 billion in total private funding to date, but are just getting started.
Why is it important: Funding for climate tech startups still remains relatively low, accounting for less than a quarter of all venture capital dollars deployed over the past year.
By the numbers: Crunchbase looked at 27 climate tech startups that raised private funding in the past year. A Crunchbase representative says Axios that it has tracked data from climate tech companies for as long as any other industry, but began publishing targeted reports in the past year.
- The industry was dominated by just four companies that have raised over $100 million each to date. These four companies – GridPoint, Xpansiv, Arcadia and Persefoni – accounted for approximately $818 million of the total $1.3 billion raised.
- More than half of the total funding to date – $640 million – has been secured in the past year.
- About half of that number was increased in 2022, reports Crunchbase.
- Eight of the 10 most funded climate startups were based in the United States
Between the lines: Large rounds indicate that more capital is pursuing only a handful of target companies.
- Carbon accounting is a particularly attractive area for investors. Watershed, a three-year-old carbon accounting startup, was valued at $1 billion in its last round in February, a $70 million Series B.
What they say : “Climate-focused software startups were a hot area for seed investment last year,” Crunchbase wrote. News’ Joanna Glasner. “Now it seems companies are moving to bigger rounds and much higher valuations pretty quickly.”