‘Recession Resilient’ Climate Start-Ups Shine in Tech Downturn

But the stakes are too high to be cynical, climate entrepreneurs and investors said.

“There’s a bigger fight to fight,” said Elisa Jagerson, an investor at Wildcat Venture Partners. “Everything else feels like rearranging deck chairs on the Titanic.”

It wasn’t always that way. When Julia Collins pitched investors on her climate tech start-up in 2019, she dedicated the first slide of her presentation to a dramatic explanation of the climate emergency. She had created Planet FWD, a software provider that helps businesses manage their climate impact, and Moonshot, a snack food company that uses regenerative ingredients, local suppliers and recycled packaging.

“I had to spend a lot of time on the pitches bringing people up the learning curve,” she said.

That has since changed as climate change and extreme weather events became impossible to escape. “We’re well beyond the point of having to prove climate change, or that it’s a big market,” said Ms. Collins, who no longer uses the dramatic slide in her pitches.

Some of the new climate start-ups are already increasing in value, at least on paper, fueled by the floods of cash. Josh Felser, an investor at Climactic, a venture capital firm, said the 11 climate companies that he and a partner had backed over the last two years were now worth two and a half times what they had been at the time of investment because other investors had put more money in at higher valuations.

“It’s not because we’re that good,” he said. “It’s because the market is so hot.”

Founders said business was booming because potential customers faced more outside pressure to become environmentally friendly, pushing them to spend money on things like emissions trackers and carbon offsets. Infogrid, a start-up that provides tools to make buildings operate and use energy more efficiently, previously had a hard time selling its products to customers, said William Cowell de Gruchy, the company’s chief executive.

“Now they’re like: ‘We’ve got to do this. Our shareholders are making us. Our boardroom is making us. Regulators are making us,’” he said.