Green Business

Corporations plus climate tech startups = scale

Written by pgex7

There are literally hundreds, maybe thousands, of technology accelerator and incubator programs — with a smaller subset catering specifically to firms working on software, applied tech and new business models related to climate tech.

How do I filter which ones get my attention? In my view, the most effective initiatives are solidly aligned with pretty large corporations that can help determine quickly what will work at a commercial scale — and what won’t.

Several programs jump to mind, such as Techstars, which partners with big companies to help run accelerators such as the one it supports for Stanley Black and Decker. This year’s focus was electrification. At the top of my list is 100+ Accelerator, launched in 2018 by Anheuser-Busch InBev with a mission to support “sustainable innovations in supply chains.” As AB InBev CSO Ezgi Barcenas put it last week during the annual Demo Day for the accelerator: “Sustainability is the ultimate design strategy… this is not about building a sustainability strategy, but about a business strategy that is sustainable.”

This sort of innovation needs to be collaborative. Full stop. That’s why a year ago, the big brewing company added funding and resources from the Coca-Cola Co., Colgate-Palmolive and Unilever — companies that have a huge consumer presence. This is a big deal, especially when you consider that the latter two companies are competitors.

“We face the same set of challenges,” said Sudeep Banerjee, vice president of procurement for Unilever, pointing to issues such as how to ensure a fair living wage within supply chains. Banerjee and counterparts from all four corporate backers participated in a panel during the Demo Day event.

“The challenges that we face are global challenges,” noted Faisal Zanjani, global head of open innovation, experimentation and new tech ventures at Coca-Cola, during a panel discussion. “As humans, we have a history of sharing and collaborating, and we should be building on it.”

Ann Tracy, chief sustainability officer for Colgate-Palmolive, said the program is helping her company more explicitly embed innovation around sustainability in its core business plan. “We get to set these targets and don’t know how we’re going to get there … There are technologies that don’t exist yet that have to be developed, that are going to ultimately be how we close these gaps.”

Added Barcenas: “This is about having a learners’ mindset. We can no longer believe we have the only solution.”

70 startups and counting

During its lifetime, 100+ Accelerator has worked with about 70 firms (three cohorts), which receive mentoring and business resources along with up to $100,000 to pilot their technology in the field with one of the corporate sponsors. They also get a chance to pitch their technology or business model to investors at a Demo Day like the one I watched virtually last week. There were more than 1,700 applications for the cohort that will be announced in August, according to Barcenas.

Attendees of Circularity 22 last month had an opportunity to meet a past participant, BanQu, a company that provides a service that helps individuals get credit for their contributions to complex supply chains, during a keynote conversation I hosted about transparency and traceability. The interview centered on its project with Coca-Cola in South Africa to help informal plastic waste collectors be acknowledged, and better paid, for their contributions. (You can watch the session here.)

The event last week featured close to 30 speed-pitches — including one by 2020 GreenBiz 30 Under 30 honoree Robert Luo, founder and CEO of Mi Terro, which is turning food waste into packaging. (It’s of interest to Unilever.)

I was able to audit about a third of them during the main session. The ideas and innovations ran the gamut from software for tracking industrial energy efficiency, water consumption metrics and more (Plutoshift) to pellets that remove phosphorus from water to reduce algae blooms (Water Warriors) to a scheme for Fair Trade plastic that verifies the waste collectors behind a recycled plastic stream are being paid a living wage (Plastics for Change).

My inner geek was particularly awed by three of the startup pitches I was able to watch:

  • Arborea: Focused on the challenge of scaling food cultivation while harnessing as little land as possible, this venture from the UK and Portugal is turbocharging the photosynthesis process to produce protein from algae while sequestering CO2. It’s piloting the approach with AB InBev, which is using the captured CO2 in brewing processes.
  • Chanzi: Hailing from Tanzania and Kenya, the company feeds organic waste (such as spent yeast from AB InBev’s breweries) to Black Soldier Flies to create an alternative source of animal feed. The idea is to replace feeds made out of soya bean meal, which is linked to rampant deforestation.
  • MakeGrowLab: Based in Poland, the biomaterials startup is also upcycling food waste and turning it into alternatives for leather and some types of packaging. One of its focuses is the roughly 20 billion cartons used to sell things such as toothpaste (hello Colgate), as well as flexible sachets for liquid that can dissolve in water.

That’s the tip of the iceberg when it comes to the sorts of problems that the 100+ Accelerator startups are addressing. The earlier startups included approaches for using recycled electric vehicle batteries, green cleaning solutions, returnable packaging and solar thermal systems. As of April 2021, the first two cohorts had raised $200 million in funding, and I would suspect that number is much higher now. Mi Terro, for one, disclosed a $1.5 million round in March. I am sure others have escaped my notice.

As we continue to dig into climate tech coverage at GreenBiz, I’m looking forward to learning more about many of these companies, as well as the ones that will be announced in August. I also suspect that we will see more organizations become involved in supporting this initiative than the four I’ve already mentioned. During the discussion last week, the existing corporate backers of the program noted that they are open to getting the startup finance community involved more explicitly. After all, the program sends clear signals about the technologies and innovation these companies need to tackle their own sustainability agendas.

“We are informing the startup ecosystem about the problems that we are facing and that we can’t solve on our own,” Barcenas said.

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pgex7

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