About two dozen venture capital firms say they are collaborating to “build a strong movement” in the venture capital business to combat the climate crisis. The group calls itself the Venture Climate Alliance, or VCA.
The alliance counts well-known technology investors, including Kleiner Perkins, Tiger Global and Union Square Ventures as members, and said in a joint statement Tuesday that its goal is to “identify, facilitate and realize net-zero compliant paths” early on. Staged startup.
Several things happen here.
Physically speaking, VCA says its members will kick things off by assessing a “carbon footprint range of 1-3,” and by pledging to hit “net zero or negative emissions for their company’s operations” by the end of the decade.
VCA also says its members are committed to helping their portfolio companies set net-zero goals for 2050 at the latest. Along the way, supposedlyReport transparently on your progress over time.”
Crucially, “net zero emissions” is not the same as zero emissions, and companies have it He got audited To use this language for obfuscation persistent carbon pollution. Net-zero targets based on carbon offsets invite skepticism, given the offset industry’s poor track record to date.
The VCA installation is also noteworthy. Many well-known professionals are reaching out to some relatively niche companies, such as S2G, a prolific food tech backer, and Fifth Wall, which focuses on real estate and runs a massive building-focused climate fund. In theory, VCA members could share a cool, slick Rolodex of experts and pass on what they’ve learned across industry lines.
Directly, the VCA is a signal from high-profile investors that they’re still investing in climate solutions, whether it’s “climate technology” or broader decarbonization efforts. This matters because, two years after the explosion, climate tech funding ebbed in the first quarter of 2023, raising doubts about whether the sector is still as trendy or as “recession proof” as it seems.
In an email to TechCrunch, climate finance consultant Dan Firger said the VCA Methodology Working Group will begin developing a list of best practices and disclosure guidelines in May. “We expect to share more information with members and the public along the way,” he added.
Firger said VCA membership is non-binding and members can leave “at any time”. Membership is also not limited to the 23 investment firms currently on board. The group said in a statement that it is open to any investment firm that “agreees to fulfill VCA’s obligations and to actively contribute to the organization.” Other members at launch include Oburred, DCVC, Prelude and Clean Energy Ventures.