Those of us in Silicon Valley in the early 90s rode tremendous waves of change.
First, there was the enterprise software revolution, driven by the advent of the PC. Next, the development of mobile phones and the worldwide web led by firms like Cisco and Qualcomm drove new forms of communication. Then came the explosion of internet companies, with social media changing the very fabric of our societies.
We are now riding the next great wave of technological change, driven by entrepreneurs who want to lead an environmental revolution. But unlike in the 90s, when Silicon Valley was at the heart of the action, this revolution is taking place in Europe.
The ingredients for sustainable success
European governments, at a national level and also through the European Union’s Green Deal, have been the most active in finding solutions to address the climate emergency and other environmental challenges. The UK’s pledge to go net zero by 2050 is one such example. Other countries in the EU are banning diesel and petrol cars from cities, limiting fossil fuels for heating and banning single use plastics. The US, by contrast, has only seen uneven measures at the state level over the last four years of the Trump administration. They are behind.
It’s not just Europe’s governments pushing for change; its corporates are leading, too, with the likes of Bosch, Unilever, Danone and others positioning themselves as ‘role model’ corporate citizens. Last year, Bosch achieved carbon neutrality, while Danone is aiming to make 100% of its packaging circular by 2025 – up from an already impressive 86% in 2017. IKEA hopes to be a fully circular and climate-positive business by 2030.
And when we look at the attitudes of the general public — even taking into account regional and socio-economic differences – there is a bedrock of support for climate action in Europe. A growing number of citizens are eager to incorporate sustainable alternatives in their daily lives, creating a large market for environmentally friendly products and services. A 2020 report conducted by Europa found that 94% of Europeans believe environmental protection is important to them personally; and 33% say the most effective way of tackling environmental problems is by changing the way we consume. Meanwhile, the fact 21% of Germans voted for the Green Party in the last European election is a clear signal that change is desired.
Governments, large corporations and the European people are all on the same side, creating a fertile environment for startups to both prosper and make an impact. This support underpins today’s environmental technology revolution.
The climate revolution today
The push for sustainable change in Europe is not just wishful thinking — great entrepreneurs are, right now, working to enable it.
Net-zero companies in Europe — who add no incremental greenhouse gases to the atmosphere — raised £2.1bn from VC funds last year, up 129% on the previous year, compared to a 16% increase for US companies and a 30% decrease for Chinese businesses. The European Innovation Council alone backed 64 ‘green deal’ startups in 2020 from a €300m funding pot.
At ETF Partners, more than 1,000 startups a year are submitting their plans to us; this is more than ever before and double what we saw just 10 years ago. These businesses are not just driven by commercial success; they are mission based and striving to deliver change across all parts of life in Europe.
In mobility, new transport options abound, from shared assets to electrified vehicles from the likes of Onto. In logistics, there’s a strong digital push for efficiency and reduction of CO2 emissions, led by Shippeo, while Climeworks is making huge strides in the carbon capture industry. In energy, companies are focusing their attention on renewable generation and investing in the smart grid, with companies like Octopus Energy and Bulb at the fore. Finally, responding to the rise of the sustainable consumer, companies like Germany online retailer Share are helping us make better day-to-day choices.
Driving Europe’s climate revolution forward
Europe and its startups are leaders when it comes to taking action on climate change – but the hard work cannot stop now.
The pandemic has absorbed the attention of governments and the general public over the past 12 months, but it has provided important lessons for how to manage a crisis.
The pandemic has taught us the importance of preparation, and shown us that societies can move rapidly and adjust behaviour in times of great need. The rapid and successful development of vaccines also reminds us that technological innovation is fundamental to solving the grand challenges of the day.
Governments, large corporates and startups must keep these in mind as they continue to address the climate change emergency. To address the climate change crisis, we need scientists and entrepreneurs across a variety of industries to lead the charge.
And while the urgency around our situation grows, I am more optimistic than ever. The environmental revolution is truly underway – and it is happening here, in Europe.
Rob Genieser is a managing partner at ETF Partners, a European VC firm that focuses on sustainability.