In pursuit of optimising outcomes, investment decisions should be measured, considered, and underpinned by strong commercial reasoning. Not driven by overenthusiasm in the deployment of capital into hot markets. An increase in investment into green technologies and climate-tech innovation should be welcomed and encouraged by us all, but successful outcomes – at a micro-level and across sectors – will depend in no small part on optimising capital allocation. Ensuring the right investors support the right companies at the right time, will not only optimise investor return structures, but will go a long way to enabling growth and maximising the impact that climate-tech innovators and green energy companies ultimately have.

With more governments and companies making net-zero commitments, there’s little doubt that demand for solutions that facilitate net-zero advancement will continue to rise, but without a clear pathway to achieving the targets we do not yet know which technologies, products and initiatives will comprise the supply side.

Many of the world’s emissions problems can be tackled using existing technologies however, net-zero will also require new solutions – nascent, and without proven economic models – to be developed at speed and deployed at scale.

Aligning the capital needs of companies to the investment criteria of funders will be critical. Appropriately assessing the value of companies, at various stages of their development, will be vital in getting this right, and in avoiding a repeat of the investor burn-out that followed the 2006- 2011 clean-tech funding boom that was rife with over-valuation and inappropriate financing models (according to a landmark MIT report).

Climate-tech innovation is essential and should be supported at every turn by capital markets, but recognition that appropriate investment structures and robust valuation play a critical part, should not be underplayed.