Renewable Energy and Climate Tech Investment Take the Spotlight at Denver Startup Week 2023
The statue of a Rocky Mountain Sheep keeps watch outside the Byron White U.S. Courthouse in downtown Denver. (Photo: Joseph Gaines).
Investment Leaders Get Real on Colorado Climate Tech
“Money makes the world go round” goes an old Broadway tune, and, at least when it comes to climate technology startups, there’s more truth than poetry in those words.
As a software product manager who has worked with a variety of startups thus far in my career, I’ve often had a front row seat to issues of funding (usually, that is, how hard it is to find).
I’ve now worked with and for several varieties of startup founder and have heard up close and personal their agita, concerns, and priorities when it comes to navigating what venture capital, private equity, and other funders are demanding of them. It’s a daunting, years-long process that sees more companies fail than not, and the environment of continually rising interest rates and mass layoffs in tech over the last year and change has only made things harder still.
Until this year’s Denver Startup Week, however, I’m not sure that I’d ever heard things from the other side of the table – the funder’s perspective, that is. If you’re building a startup, it may be hard to get facetime with representatives of venture capital, private equity, and other granting and investing institutions, but they’re not exactly shy about expressing opinions.
And this year I had the chance to hear from a number of them directly.
Denver Startup Week, founded in 2012, typically attracts about 10,000 devotees of all things entrepreneurial, with an especial focus on tech. This year’s festivities, which ran Sept. 18-22 and included over 200 free events spread out across the downtown Denver area, featured various themed tracks from which one can choose, including product management, design, founders, and more. Given scheduling, it’s literally impossible to attend them all even if you wanted to.
And since I’m a Product person with a particular focus on climate, sustainability, and renewable energy I was particularly excited about two events – really two sets of events – this year.
First up was Navigating the Colorado Climate Tech Ecosystem, which took place Tuesday at the lavish law offices of Polsinelli, located in the heart of downtown.
This session was a revelation: here was a panel of two venture capitalists who focus on funding climate startups, accompanied by leadership from the National Renewable Energy Laboratory’s Innovation and Entrepreneurship Center.
The panel included Sally Hatcher of Buff Gold Ventures (which focuses on projects founded by alumni of the University of Colorado), Kirsten Suddath of Next Frontier Capital, and NREL’s Danielle France.
Topics ranged from understanding distinctions between traditional and climate-focused VCs, to comparisons of hardware vs. software climate tech companies, to understanding the enormous impact of the Inflation Reduction Act on renewable energy development and investment so far this year.
It was also a session in which I was introduced to some new concepts, including non-dilutive capital, concessional finance, and what VC’s care about most when evaluating which teams they’re going to fund (the phrase “don’t work with jerks” came up more than once.)
Speaking of jerks, again and again I heard from the panel that VCs aren’t just backing projects, they’re backing people. So your startup can have all the product-market fit in the world, but if your founder is making everyone around you miserable, then you may find it challenging to build relationships you need to get your project off the ground.
(One would like to think that that would be true, regardless, but it was refreshing to hear it directly from the mouths of the folks with, well, the money.)
nsurprisingly there was a particular focus on the startup and VC ecosystem in Colorado. Suddath pointed out that, given the rapidly increasing number of energy and sustainability startups and enterprise organizations now calling this state home, “Colorado punches above its weight in terms of climate.”
While there was an acknowledgement that there are some limits to how much capital startups can raise in Colorado – essentially there comes a point in a company’s growth when they’ll have to look to the coasts and elsewhere for significantly larger funding rounds – the panel also pointed out that Colorado companies often bring more value for the money.
So it’s not just that there are indeed opportunities in Colorado for founders, but for funders, also. Everybody likes a deal, and when it comes to climate tech, there seem to be ever more deals to be had in the Centennial State.
Overall it was a fantastic event, but DSW was only the latest convention to tackle climate investing: the panel also brought up key events like NREL’s rather busy annual Industry Growth Forum, as well as SOSV’s upcoming Climate Tech Summit. And in addition to a shoutout or two during this event, many colleagues of mine were also excited to attend this year’s RE+, a gargantuan renewable energy convention that draws more than 40,000 attendees.
And then there’s the Energy Summit for grad students like yours truly in CU Denver’s Global Energy Management Program – more on that soon.
But first we’ll finish up takeaways from DSW. Stay tuned for Part II in the coming weeks and months, where I’ll be covering the marathon Future of Energy Day, which started off with a pitch competition featuring 10 competitor finalists in energy and sustainability entrepreneurship, the prize being partnering with one of the largest energy infrastructure companies in the U.S.