No longer are the table stakes only about return on investment. Corporate leaders, NGOs and governments recognize that climate tech can serve two distinct roles, providing: 

1. A needed path to intervene around climate change
2. A business development laboratory for future products leading to profits.

Several prominent private equity groups have begun to recognize that climate technology and sustainability information platforms offer fertile ground for return on investment – promising returns for limited partners and essential benefits to the planet. In a recent visit to Israel, a nation noted for cultivating a bounty of start-up companies and “unicorns,” we met several of the country’s leading incubators, accelerators, and equity groups that have made climate tech their investment priority.

Seven Powerhouse Investment Groups

While many of the world’s leading equity groups have headquarters and branches in Israel, these seven organizations have prioritized climate tech. If you’re tracking the environmental innovation sector, make sure you’re following these venture capital groups that span the incubator, accelerator, and equity fields:

• Capital Nature is an Israeli private equity group – a front-runner – investing in environmentally focused startups and businesses. Launched as an incubator by the Israel Innovation Authority 10 years ago, Capital Nature, led by one of Israel’s top investors, business executives, and entrepreneurs, Anat Tsour, empowers entrepreneurs to develop scalable ventures by providing financial support, strategic guidance, and connections. The group actively seeks startups that address critical environmental challenges such as renewable energy, waste management, water conservation, and sustainable agriculture, fostering a vibrant ecosystem of green innovation in Israel. LINKEDIN

• Doral Energy-Tech Ventures has emerged as a key player shaping the landscape of climate technology. With its focus on sustainable innovation, Doral Energy-Tech Ventures has consistently invested in – and sought connections with – early-stage solutions that address pressing environmental challenges. Its strategic collaborations with startups and established companies have propelled the development and deployment of groundbreaking technologies spanning renewable energy, carbon capture, and efficient resource management. Roee Furman, managing director of Doral Energy-Tech Ventures, offers portfolio companies a welcomed combination of expertise and funding. Doral Energy-Tech Ventures is a lead global catalyst accelerating the transition to a more resilient and low-carbon future and the vital role private enterprises play in advancing climate tech. LINKEDIN

• Gravity Climate Fund focuses on climate change and sustainability. The fund was launched by one of Israel’s leading voices in climate technology, Bracha Halaf, formerly chief scientist at the Ministry of Energy. She brings her expertise as a principal at Qure Ventures, an OurCrowd fund, to the much-needed effort to accelerate the transition to a low-carbon economy by investing in early-stage startups and disruptive technologies. Gravity Climate Fund supports ventures that tackle climate challenges head-on, including renewable energy, energy storage, electric mobility, and sustainable infrastructure. Their strategic investments and support help drive technological advancements and create a more sustainable future.

• Israel Innovation Authority (IIA) is a government agency that promotes technological advancements and innovation across various sectors, especially the environment. The Authority supports initiatives focused on environmental sustainability, offering grants, funding programs, and mentorship to startups and research institutions – even supporting “laboratories” to field test promising innovations. The problems facing cleantech companies are not unique to Israel. IIA is sponsoring some 100 Israeli-based companies heading to COP28 in Dubai. IIA has a solid track record in clean technologies, resource efficiencies, and sustainable practices as the nexus among academia, industry, and government. LINKEDIN

• Mass Challenge Israel is the largest and most diverse zero-equity accelerator in Israel and has included a climate tech track among its operational priorities. Its comprehensive programs enable climate-focused startups to thrive by providing strategic mentorship, resources and connections to investors and industry leaders. Mass Challenge Israel accelerates the development of cutting-edge solutions addressing the world’s pressing climate challenges through collaboration between entrepreneurs and experts, and by doing so, contributes to the growth of sustainable technologies and the global effort to tackle climate change. LINKEDIN

• PLANETech is a nonprofit innovation community for climate change technologies – a joint venture of the Israel Innovation Institute and Consensus Business Group. Its power team, led by Noam Sonennberg, offers tailored acceleration programs, strategic mentorship, and access to a vast network of investors and industry leaders; PLANETech provides companies with the tools and resources needed to succeed in the complex world of capital and policy. Through its community, it emphasizes knowledge exchange so sponsored companies can refine solutions, scale their impact, and address the pressing challenges of climate change. PLANETech support is instrumental in laying the groundwork for groundbreaking technologies that contribute to a more sustainable and resilient future. LINKEDIN

• Start-Up Nation Central, an Israel-based non-profit organization, has fostered innovation and technological advancements in the field of climate tech. By connecting startups, researchers, investors, and corporates, they are accelerating the development and deployment of solutions addressing climate change challenges. Along with supporting companies at the forefront of climate tech innovation, Start-Up Nation Central has developed a visual inventory of 760 early-stage enterprises developing climate solutions. The go-to voice for the sector at Start-Up Nation is Yael Weisz Zilberman, who leads sector efforts.  LINKEDIN

The climate-tech community is tight-knit, and ready access to private equity leadership is a given. The conference platforms are many, and the post-panel conversation offers plenty of opportunities to connect and chat. Israeli-based private equity groups have shown leadership and gravitas in advancing environmental innovation.

Follow the Money? Not Quite.

Through financial support, strategic guidance, and collaboration, these entities nurture startups by opening their bank accounts and, perhaps more importantly, their contact databases. As Israel continues to prioritize sustainability and environmental innovation, investors and partners outside the “Start-Up Nation” will look at the hundreds of companies entering the climate tech sector and, most importantly, the private equity group portfolios doing the due diligence and counseling behind the scenes. Follow the money and the wisdom!

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Israel – The Climate of Innovation Heads to COP28

While some are still considering whether to head to Dubai for COP28, Israel is committed to having significant presence at the “Davos of Climate Change.” Known for its health, defense, technology and entrepreneurship achievements, the country is emerging rapidly as a global environmental innovation leader.  Israel plans to bring a 1,000-person delegation representing some 100 companies to Dubai. 

According to Start-Up Nation Central – the non-profit that connects Israel’s tech and science community to the world, almost 1,000 Israeli enterprises are pursuing a range of decarbonization, climate adaptation, and environmental protection technologies with the potential to mitigate the impacts of climate change and address its root causes.

“With our global outreach to multinational companies and investors, we are advancing the Israeli energy sector and its technologies as an important and viable solution to the world energy challenge and a solutions hub for reducing global carbon emissions,” said the non-profit’s Head of Climate Tech Sector Yael Weisz Zilberman. “Mapping sub-sectors and the companies in each provides broad accessibility to Israeli technological solutions and enables the entire sector to expand its activities.”

Many consider COP28 as Israel’s “declaration to lead” event. For the second consecutive COP event, the Israeli pavilion in Dubai will appear under the “Climate of Innovation” umbrella. The connection of Israel to innovation is expected; the country known for making the desert bloom takes on ecological challenges with can-do confidence married with an inventive spirit to develop groundbreaking solutions that can significantly impact climate change and support sustainability.  But that doesn’t happen without dedicated, collaborative effort.

Collaboration is Key to Creating Technology that Addresses Climate Change

Through a combination of government support, academic research and a strong, healthy community of entrepreneurial businesses, Israel is a fertile proving ground for environmental innovation, so much so that the country’s innovation community has created a collaborative blueprint for other nations to follow. 

The Israeli government has implemented policies and initiatives to support and promote innovation with major companies at home and abroad, and with other nations to prioritize climate change and sustainability for investment and development.  It has resulted in Israel becoming a laboratory for research and development in renewable energy; water purification, desalination and management; and sustainable agriculture. It’s also an approach that delivers returns on investment by building a collaborative culture of innovation.

For example, a collaborative Environmental Sustainability Innovation Lab (ESIL) dedicated to environmental protection and sustainability is among the nation’s many exciting projects. Another is the creation of the Israel Innovation Authority (IIA), a cooperative effort between the Israeli Ministry of Environmental Protection and the Israeli Ministry of Economy launched in 2019. Start-ups participating in these incubators receive advice and funding to build infrastructure and have a better pathway toward financing for their “proof of concept.”

The incubator is a model for accelerated progress, and its reputation has had global benefits. Morocco, the fourth Arab country to normalize ties with Israel, is now pursuing cooperation with Israel in environment, natural resources and climate change. If long-time enemies can recognize that without a sustainable planet, all are lost, it provides hope that we can make progress against rising global temperatures.

Investing in the Planet’s Future

Crucial in advancing environmental innovation is Israel’s thriving startup ecosystem. The country is home to a growing community of entrepreneurs and venture capitalists passionate about accelerating technological solutions to pressing environmental problems. Startups are tackling diverse issues, ranging from waste management and recycling to energy efficiency and urban sustainability. Purpose-centered investors with proven ROI track records are focusing on the progress and potential of Israeli-based environmental innovations.

Investors are also crucial to that collaborative effort. Among the premier, global, purpose-focused investors watching the sector in Israel is ARK Invest, which believes innovation can solve the most persistent problems and help transform the way the world works. They are doing more than watching the start-up nation; they are going all-in, looking for both return on investment and meaningful social impact.

ARK Invest recognized that Israel is a world leader in developing innovative products and services.  Its Chief Investment Officer Cathie Wood shared with Medika Life that “Israel’s companies are advancing scientific research and enhancing many sectors of the global economy. Ranked highly in the world for technological advancements and entrepreneurship and responsible for many innovations, ARK thinks Israel has earned its status as an innovation powerhouse.”

The Climate Innovation Model

Through government support of collaboration that brings together a matchless entrepreneurial ecosystem; technologists with a proven track record of practical advancements; a community of thriving startups; and visionaries in Israel and other countries, Israel has become a must-watch leader in addressing climate change and promoting sustainability. Other nations – particularly emerging nations – face similar challenges and conditions, and they can accelerate the global transition to a greener, more sustainable future by fostering collaboration to create an infrastructure that guides, supports and brings purpose-centered investors to the table of possibilities.

A world facing climate change that threatens human health and long-term existence needs proven models that point the way to achieving a sustainable future. Israel, poised to join the inner circle of climate leaders, is a success story and a model for others to follow.

[The next report will come from Israel and highlight some companies at the forefront of environmental and sustainability innovation.]

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