🌍 MPower debuts new ESG fund in Japan #71CommentShareCommentShare

Happy Monday!

In this week’s issue, we profile the rise of a new fund in Japan, the revivals of mammoths, and the unfortunate reality of most mega CCS projects. In the news, John Kerry comes out swinging on methane, a new coalition teams up to deliver the home solar credit more equitably, and ICEs get banned in NY.

Plus a calendar’s worth of events leading up to Climate Week, and some stellar new climate gigs.

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New ESG, female-led fund debuts in Japan

Last week, climate analytics provider Jupiter Intelligence announced a fundraise co-led by a new cap table player, MPower Partners - which caught our eye for being novel on a number of fronts:

🈺 MPower is Japan's first ESG-focused global VC firm

🙋‍♀️ MPower is the first female-led VC firm in Japan

🌏 US-based Jupiter’s accelerated expansion into Japan is likely first of more US-APAC growth-stage climate startup crossovers

We Zoomed across the world to hear more directly from these torchbearers. [Interview has been abbreviated for length.]

What's MPower’s founding story and thesis?

In May of this year, we [Kathy, Yumiko, Miwa] officially launched MPower Partners. We’ve been friends for decades, and are all veterans of Japan's extremely male dominated finance industry. The bulk of our careers in finance have been in an economy that’s struggled with persistent deflation, growing fiscal debt, and challenging demographics. The burning question is, how will Japan grow long-term? The combination of our experiences [from Goldman, research on Womenomics, gender diversity, Japan’s corporate governance] are today called ESG. We launched MPower as the first ESG-focused VC fund in the country with a hypothesis that integrating ESG principles into startups will enhance their growth and long term scalability.

We got quite lucky that even while fundraising during COVID, some very large institutional investors and corporates were aligned with our mission of integrating ESG into startups. The fund is middle- to later-stage focused and roughly 2/3rds Japanese, with the rest overseas - which is where Jupiter fits in.

How does climate tech fit into your definition of ESG?

Our overall fund theme is what we call “tech-enabled sustainable living.” We have five focus areas: healthcare & wellness, fintech inclusion & accessibility, future of work and education, next-generation consumption, and environment - which includes climate tech, agritech, recycling, and green materials.

What's your take on the Japanese market adoption of climate tech, at home and abroad?

The level of commitment and awareness of climate change is very high and a priority in Japan. We've had the tsunami in Fukushima, and an increasing frequency of extreme climate events and flooding. Climate is not only top of mind for Japanese companies, but also the Japanese people. A few months ago, the Japanese government officially announced a commitment to reach net zero by 2050 - which is very ambitious. While there are climate tech solution companies here, we also need to lean on possible solutions from outside of Japan.

In that regard, we believe that Jupiter's highly-sophisticated next generation climate risk analytics system which can provide physical climate risk assessments for mortgage portfolios to insurance assets will have immense demand in the Japanese market. One of the value propositions that MPower brings to overseas companies like Jupiter is helping to expand their presence in the Japanese market.

MPower Partners is open for business! If you’re interested in connecting with Japan’s first female-led and first ESG-focused VC firm, Kathy, Yumiko, and Miwa would love to hear from you - particularly if you’re a post-revenue climate-focused business that’s appropriate for the Japanese market. Plus, Jupiter is hiring for a Japan country manager.

Deals of the Week (9/13-9/19)

🌱 AgBiome, a Durham, NC-based developer of microbial-based products including a fungicide for disease control in a variety of crops, raised $116m in Series D funding from Blue Horizon and Novalis LifeSciences.

⚡ Arcadia, a Washington DC-based startup that provides access renewable energy without having to change power companies, raised $100m in Series D funding from Tiger Global Management and the Drawdown Fund, Wellington Management, Reimagined Ventures, Energy Impact Partners, and G2 Venture Partners.

⚡ EnerVenue, a Fremont, CA-based renewable energy storage company, raised $100m in Series A funding from Schlumberger New Energy, Saudi Aramco Energy Ventures, Stanford University, and others.

🧀 Formo, a Germany-based alternative cheese startup, raised $50m in Series A funding from EQT Ventures, Elevat3 Capital, the VC arm of Christian Angermayer, and Lowercarbon Capital.

🌱 Measurabl, a San Diego, CA-based ESG analytics company, raised $50m in Series C funding from Energy Impact Partners, LPC Ventures, Starwood Capital, S&P Global, Sway Ventures, Salesforce Ventures, Constellation Technology Ventures, and Building Ventures.

🌱 Calysta, a San Mateo, CA-based company focused on alternative proteins, raised $39m in Series D-1 funding from bp ventures, Adisseo, AquaSpark, and WTI.

💨 Patch, a San Francisco, CA-based API-first carbon offsetting startup, raised $20.8m in Series A funding from Coatue Management, Andreessen Horowitz, VersionOne, and Pale Blue Dot.

🌱 Sourceful, a UK-based supply chain sustainability startup, raised $12m in Seed funding from Index Ventures, Eka Ventures, and Venrex.

✈️ Skydweller, an Oklahoma City, OK-based solar aircraft startup, raised $8m in funding from Leonardo S.p.A, Marlinspike Capital, and Advection Growth Capital.

♻️ Gr3n, a Switzerland-based recycling company, raised $7m in Series B funding from Chevron Technology Ventures, Standex International, and others.

🍎 Releaf, a Nigeria-based agtech startup focused on industrializing food processing in Africa, raised $2.7m in Seed funding from Samurai Incubate Africa, Future Africa, and Consonance Investment Managers, and others.

♻️ Verdafresh, a Wayne, PA-based startup producing fully recyclable barrier films for food packaging, raised $2.5m in funding from Rhapsody Venture Partners.

💡 Shimmer Industries, a New York, NY-based end-to-end software automating the design and deployment of large-scale lighting projects, raised $2m in Seed funding from VoLo Earth Ventures.

☔ Jupiter Intelligence, a San Mateo, CA-based extreme weather and climate risk management firm, raised an undisclosed amount for an ongoing funding round from Clearvision Ventures and MPower Partners.

Exits & New Funds:

Maki.vc, a Finland-based Seed-stage firm focused in part on sustainability, is nearing a $117m final close on its second fund.

In the News

Leading up to COP26, we’ll see a lot of climate pledges - and this week, John Kerry has been busy. The US Climate Czar and President Biden plan to convene a global meeting prior to COP26 to push international action on methane emissions- a greenhouse gas with 24x the warming potential of CO2. Kerry has also pledged to mobilize funds and share technology to help India fulfill its clean energy target by 2030.

Tax incentives to build solar panels have existed since 2005, but complex tax structures and high upfront costs have kept rooftop panels inaccessible to the majority. Residential Renewables for All, a new coalition of 350 orgs including the National Wildlife Federation and the NAACP, is lobbying to re-envision the home solar credit as direct pay to make rooftop solar accessible to nonprofits and low-income people.

Following California’s lead, New York State will ban the sale of new gas-powered cars starting in 2035. The two states combined represent 17% of all US auto sales, quickly approaching critical mass where manufacturers must rethink future US ICE car production.

A study of 263 carbon capture projects definitively shows that most CCUS projects initiated in the past three decades have failed to capture their target carbon emissions. The greater the plant size, the greater the failure rate. Meanwhile O&G companies continue to buy into Exxon’s $100b CCS hub concept in Houston - going so far as to claim it as a “climate solution.”

The world’s largest mining group, BHP Group has partnered with KoBold Metals to meet the surging demand for rare minerals for clean energy tech. The Gates and Bezos-backed startup locates copper and nickel for use in EV batteries - and it couldn’t come at a better time. BNEF’s battery guru, James Frith, hinted at a reversal in battery cost decline due to this year’s tight supply chains.

Redwood Materials, the world’s largest Li-ion battery recycler, revealed a big secret: it’s not just a recycling company. JB Straubel wants to bring EV battery production from Asia to the US, and build a huge battery factory in Nevada capable of producing enough batteries for 1.3m EVs / yr by 2025 (or $25b worth of cathodes a year)!

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*Ben Lamm, George Church, and a woolly mammoth. Credit: Colossal*

Synbio legend George Church raised $15m for Colossal, a bioscience and genetics company working to revive the wooly mammoth. Colossal has already revived bioethical issues galore, and claims the mammoths can fight climate change by… exposing grass on the arctic tundra.

Fight fire with a herd for hire. Are goats the GOAT for wildfire prevention?

McKinsey released a new paper on the future of e-mobility, starting with a real hooker of a first sentence - “That hum in the distance is the sound of the concept of mobility changing—for the better.” 🙈 Joking aside, the report’s good.

Engine No. 1 released its Total Value Framework, a data-driven investing approach that ties ESG metrics to long-term financial value creation. Not enough? AQR’s Cliff Asness argues that ESG investors should actively short worst performers, and count the short positions as offsets for reducing emissions exposure.

In a bid for “radical transparency” leading up to COP26, Al Gore’s Climate TRACE dropped the first comprehensive database of GHGs based on “direct, independent observation.” It’s huge. Play around with the output from 59 trillion bytes of data from more than 300 satellites and 11,100+ sensors here.

Pew Research Center released a new poll of adults across 17 advanced economies on their sentiments around climate change. In general, concern about the personal effects of climate change is increasing sharply, but many have doubts about the efficacy of international action.

Fabulous framing suggestions for COP26 from Carbon Tracker to pitch “gain not pain” at the international negotiations, and particularly “how can we bring forward this great wave of innovation and wealth generation to avoid climate chaos?”

Lowercarbon’s Clay Dumas tweets about fusion, and climate tech Twitter goes nuclear.

Opportunities & Events:

🗓️ Watershed-hosted Climate Week Forum: Join Watershed on Sept 23rd for free virtual event about climate solutions that really matter. Speakers will feature architect of the Paris climate agreement Christiana Figueres, Kleiner Perkins chair John Doerr, climate leads from Stripe and Shopify, carbon removal entrepreneurs, and more.

🗓️ LACI’s Power Day: Tune in on Sept 23rd for pitches from LACI startups and speakers from Trucks VC, EIP, and Equal Ventures. RSVP if interested in attending as Power Day is by invite only for an audience of investors and those working in corp dev/biz dev/tech scouting in cleantech.

🗓️ A Market for Carbon Removal: Join CarbonCure and Carbon180 on Sept 23rd for a virtual Climate Week NYC conversation on both the opportunities and challenges in buying and selling high quality carbon removal credits on our path to net zero with panelists from Shopify, Swiss Re, and XPRIZE.

🗓️ Nordic Climate Tech Demo Day: Join Oslo Innovation Week on Sept 28th to meet nine leading nordic climate tech companies followed by a Q&A session with an expert panel.

🗓️ KAITEKI Challenge: Tune in on Sept 30th to the Final Showcase to learn about startups on the cutting edge of food loss and waste reduction in the proteins, plastics, and packaging industries.

💡 Accelerate Behavior Change: Amasia is sponsoring non-profit Behavior Change to offer early-stage teams the tools to integrate the science of behavior change into their products. Apply to join the (free) cohort by Oct 10th.

💡 Climate Change AI Innovation Grants: Apply by Oct 15th for $150k from a $1.8m prize pool committed to funding year-long research projects at the intersection of AI and climate change.

💡 Activate Fellowship: Are you a scientist or engineer working on an impactful innovation? Activate empowers scientists to reinvent the world by bringing their research to market through a two-year entrepreneurial fellowship. Watch this 2 min video to learn more and join us for a webinar/Q&A panel on Oct 12th.