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Happy Monday, readers.
A few weeks back, Fortune asked for submissions to the Impact 20, a list of startups that are trying to make money while addressing social issues.
And, well, Term Sheet readers were very, very responsive to the call. Here’s the list.
What’s notable: Many startups are focusing on environmental sustainability. About 40% of the 20 startups on the list address the issue—whether it be through food waste (TreeDots), recycling (AMP Robotics), or energy consumption (Dandelion Energy).
The numbers capture a shift in momentum for so-called “clean tech.” It’s a storied part of venture-investing lore at this point: Startups seeking to disrupt the energy sector boomed in the mid-2000s—but cheap natural gas prices, a financial crisis, and high capital costs resulted in a massive bust. An MIT Energy Initiative working paper estimates that VCs plowed some $25 billion into the sector between 2006 and 2011…and lost over half of their money. The sector became nigh untouchable.
Today investors are seeing promise in the space—and not just a small glimmer of it. A study by PricewaterhouseCoopers reports that in 2019 alone, venture capitalists plowed $16 billion into “climate tech” deals, helping create some 43 unicorns. Well-regarded firms such as Sequoia Capital have called for pitches recently in the sector.While the sector has changed since 2008, with successful companies like Tesla having created space for an ecosystem to grow, it will still face challenges. For green tech companies focused solely on attacking traditional energy (and many of them are), they are competing with oil prices—which have recently taken a dive in the pandemic.
These green startups are on investors’ radar.Read More