(The Wall Street Journal) Companies are increasingly using their venture-capital arms to pour money into startups that could help them profit from the energy transition.
Last year, corporate venture funds invested $23.2 billion in businesses in the climate-technology sector—a broad category spanning renewable energy, energy storage, electric vehicles and more—according to PitchBook Data Inc. The amount invested more than doubled from 2020, outpacing growth of 85% for all corporate venture deals. The climate-technology funding was spread across 210 deals, up from 165 a year earlier, according to PitchBook.
These early-stage investments come with financial risk as clean-tech startups’ valuations come under scrutiny. The rush of deals illustrates the pressure companies are under to show that they are committed to meeting carbon-reduction targets, said Stefan Gross-Selbeck, global managing partner at BCG Digital Ventures, an arm of Boston Consulting Group that incubates and invests in startups alongside corporate venture funds.
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