Private finance plays a part in the rise of sustainable investing

Encouraging private and angel investors to seek out new opportunities in new sectors, take on mentorships with early-stage businesses and get involved in policy development, are ways in which these investors can take important strides to accelerating climate investing in an effort to achieve net-zero.

Those who are open to doing things in different ways are those who often lead the way for important change, and investors who are able to instigate change with where they place their capital, and are active in sharing their expertise and experience will likely be major contributors to the decarbonisation effort.

That sharing of expertise often looks like mentoring early-stage startups who are on the way to disrupting a sector, who might otherwise be more attentive to driving their tech forward, and have less of an understanding of commercialism and raising the investment they need.

Investors possess the skills and tools to empower these early-stage businesses to be able to find their way through the investment ecosystem and ultimately lead to invaluable solutions to driving the net-zero goal forward with carbon-reducing tech hitting the market.

Many of the Accelerator programmes, which form a part of the UK Business Angels Association’s (UKBAA) community, work to support early-stage startups focused on climate and sustainability, receiving mentoring support from experienced investors and direct introductions to investor networks.

Investors can also play an active role in informing policy, ensuring it is fit for purpose and for their needs, but also to ensure that policy furnishes a foundation for early-stage businesses to get their innovation to the market.

There are different ways for investors to make changes, both on an immediate basis as well as long-term strategies.

Long-term investors should be looking to diversify their portfolio by being inclusive of both early-stage technology businesses and disruptors that support the UKs net-zero aims and decarbonisation initiatives.

The UKBAA community points out note-worthy solutions relating to energy, smart cities, decarbonised transport, energy efficient homes, sustainable materials, agtech and even data advisory services.

Jon Pollock, CEO of Elbow Beach Capital, a private investment company focused on decabonisation, sustainable energy and social impact businesses, says, “we bring capital, but we also bring commercial expertise, because typically, you’re looking at CEOs and founders that don’t necessarily have that experience […] We believe that fundamentally you cannot have the environmental impact that’s required to get to net zero if you don’t scale your business”.

Angel investors also have this role to play, as they can invest in early-stage startups that have good grips on the technology of their innovation, but are short of commercial know-how.

In addition, angel investors may look to contribute to the development of policy where possible and to get informed on the sectors that they might not have been familiar with in the past, in order to diversify and widen the pool of opportunities for more investors to get involved in the shift to sustainable investing.

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