Venture Climate Alliance

Leading Venture Investors Form Global Alliance to Build Net Zero Businesses from Day Zero

Venture Climate Alliance to Develop Tools for Venture Capital Industry and Portfolio Companies to Track Alignment with and Contributions to the Climate Transition

San Francisco, CA - April 25, 2023 – The Venture Climate Alliance (VCA), an organization created by leading global venture capital firms to define, facilitate, and realize net zero-aligned pathways for early-stage investments, launched today with a goal to build a robust movement within the venture industry to combat climate change.

Consisting of 23 venture capital (VC) firms across the U.S. and Europe, VCA members have committed to supporting a rapid, global transition to net zero or negative carbon emissions by 2050 or sooner, and will take specific, near-term steps to achieve this goal, both within their respective firms and in their roles as investors and advisors to their portfolio companies.

Over the past few years, momentum across venture-backed climate tech innovation has been accelerated by entrepreneurial ambition, world-class innovation and more recently, increasing tailwinds driven by the U.S. Inflation Reduction Act, the EU Green Deal Industrial Plan, and other supportive policies. As one of the first institutional touchpoints between capital markets and early-stage innovation, venture capital investors have helped thousands of new companies from initial development to commercialization and scale. The VCA provides a forum through which member firms will develop best practices for collecting, interpreting and reporting carbon emissions, and climate impact data, as well as tools and guidance to help to overcome barriers associated with aligning early-stage investments with net zero goals.

The VCA’s founding members are Prelude Ventures, Capricorn Investment Group, DCVC, Energy Impact Partners, Galvanize Climate Solutions, S2G Ventures, Union Square Ventures, Tiger Global, World Fund and 2150; along with Obvious Ventures, Congruent Ventures, Valo Ventures, Clean Energy Ventures, Fifth Wall, Overture Ventures, Blackhorn Ventures, Spring Lane Capital, Azolla Ventures, Systemiq Capital, The Westly Group, Innovation Endeavors, and ReGen Ventures. It is supported by Great Circle Capital Advisors, a climate finance advisory firm.

“Our goal is to bridge the gap between what’s happening in public markets, where hundreds of companies have made bold forward-looking net zero commitments–and early stage innovation, which has the potential to decarbonize legacy industries through a combination of better products, more efficient processes, and lower costs,” said Alexandra Harbour, founder & chair of the VCA and a principal at Prelude Ventures.

‍In joining the VCA, member firms have committed to support the goal of achieving a global transition to net zero emissions. To start, venture firms pledge to inventory their direct Scope 1-3 carbon footprint and to reach net zero or negative emissions for their own firm’s operations by 2030 or sooner. Members will encourage and assist their portfolio companies in setting their own targets to achieve net zero alignment by 2050 or sooner, and will report transparently on their progress over time using best practice methodologies and disclosure guidance to be developed over the coming year. These commitments will establish stage-dependent climate-aligned goals as a part of startups’ growth strategies, rather than as a late stage add-ons to business-as-usual operations.

“We invest in climate tech companies that are transforming multi-billion dollar industries. As public markets, asset managers, and policymakers implement 2050 decarbonization goals, disclosure of climate-related risks, carbon emissions, and impact will matter for everyone– including those at the earliest stages of business building. As investors, it’s our role to prepare our teams for the realities of the markets that they’re operating in,” said Gabriel Kra, managing director at Prelude Ventures and founding member of the VCA.

“It’s critical that the venture capital industry join this fight–leveraging its experience of building innovative companies–to help scale forward-looking technologies that accelerate the climate transition," said Samson Mesele, partner at Union Square Ventures and founding member of the VCA.

Danijel Višević, Founding Partner, World Fund, commented: “At the World Fund, we strongly believe that the Venture Capital Alliance (VCA) will play a pivotal role in driving climate innovation forward. By harnessing the collective expertise of top venture capitalists from both sides of the Atlantic, the VCA has the potential to significantly influence the funding decisions that shape the future of climate startups and technologies. As a group, we are committed to backing entrepreneurs who understand decarbonisation as a value driver, and those who build tech for a regenerative world. By doing so, we aim to have a meaningful impact in mitigating the climate crisis, driving positive change through strategic investment and support for innovative ventures that align with our vision.”

The VCA has been approved by the Race to Zero under the leadership of the UN Climate Change High-Level Champions, and constitutes a new sector-specific alliance under the Glasgow Financial Alliance for Net Zero (GFANZ). The VCA will work alongside other sector-specific alliances within GFANZ to develop methodologies and tools appropriate for early-stage investments, and to share expertise on climate solutions across the broader financial sector.

Membership in the VCA is open to any venture capital firm, or a division of a larger firm that is engaged primarily in venture investing, that agrees to fulfill VCA’s commitments and to actively contribute to the organization as appropriate. For more information, or to become a member, please visit ventureclimatealliance.org.

“Net zero for thee but not for me is no longer a workable solution,” said Daniel Firger, co-founder and lead advisor of the VCA and managing director of Great Circle Capital Advisors. “If we’re serious about moving the entire world economy into alignment with a pathway to net zero emissions, we must consider the critical role that private markets play in that journey.” ‍

About the Venture Climate Alliance

The Venture Climate Alliance (VCA) is an organization created by leading global venture capital firms to define, facilitate, and realize net zero-aligned pathways for early-stage investments. The organization currently consists of more than 23 members across the U.S. and Europe that have committed to achieving net zero or negative carbon emissions by 2050 or earlier.

Additional information available at ventureclimatealliance.org.

As featured in: Handelsblatt, CNBC, Bloomberg, Wall Street Journal, Politico, TechCrunch, Axios, LA Times