Transcriber: Anna Sobota Reviewer: Rhonda Jacobs
We are here at this event because our planet needs our help.
The Earth is warming at an alarming rate
and we have not yet made sufficient progress reversing this trend.
The magnitude of the problem is increasingly clear,
but solutions remain difficult to implement at sufficient scale.
A core driver of this is that since the start of the Industrial Revolution
GDP and emissions have grown hand in hand.
This chart shows that development
with emissions in the red line and GDP in blue.
This easy growth fueled by carbon
is the only growth that we have known for generations
and resulted in massive lifestyle improvements for much of the world,
which makes it difficult to let go of.
But for the global economy to break this link
and meet any sort of emissions reductions target
we need a new type of growth:
growth that decouples economic gains from emissions.
My team views this decoupling between emissions and growth
as the greatest investing opportunity of our lifetimes.
We invest in exceptional teams
applying emerging technologies to traditional industries sustainably.
We support climate-tech companies across sectors
that facilitate a new type of green growth.
Fortunately, this economy-wide transition has taken root,
and I’m here today
to share why climate-tech touches upon everything and everyone.
Now, if you look carefully at this chart,
you’ll see that the emissions and GDP lines have already begun to cross.
This has been driven primarily by a shift in the energy sector.
Before the broader term “climate-tech” was mainstream,
a wave of entrepreneurs and investors
were working on combating climate change using clean energy.
This wave, which we call Cleantech 1.0, peaked around 15 years ago
and was focused primarily on the transition
from fossil fuels to renewables, such as solar and wind.
This was a powerful starting point,
given that energy accounts for 25% of global emissions.
The journey was not always easy.
A lot of money was lost through the first wave of Cleantech investing,
but fortunately many continue to innovate.
And these innovations, as well as cost reductions that come from scale,
have gotten us to a point
where renewables are cheaper than fossil fuels in many contexts
facilitating their adoption economy-wide,
including by those who don't necessarily care about the sustainability benefits.
But fixing the energy system alone is not enough.
My team invested in this first wave of Cleantech,
and we continue to make energy investments today,
but realized more than a decade ago
that there’s so much more to the challenge than just energy.
The next sector we started to tackle was transportation,
which accounts for up to 20% of global emissions.
We developed a vision around “mobility as a service,”
moving from a world where individuals were owning internal combustion engine vehicles
that they were driving less than 5% of the time to a future of transportation
that is shared, autonomous, electric and connected,
and moving people and goods around the world
in a cleaner and more efficient manner.
Climate-tech and transportation
means electric vehicles and the infrastructure to charge them,
and supply chains for core components such as batteries,
from mining raw materials
all the way to recycling at the end of the battery’s life.
It means LiDAR and cameras and other sensors
to make our vehicles autonomous and connected
so that they are safer, can communicate with each other and run more efficiently.
It means software and hardware to help people share their vehicles
to improve our logistical planning
so that cars and trucks are not driving around half empty
and we are not producing more vehicles than we need.
We've also been tackling food and agriculture,
another 20+% of global emissions.
Over one-third of all food that is grown is wasted.
The average food item on the U.S. dinner plate
traveled more than 1500 miles and changed hands four to eight times.
Just the nitrogen fertilizer supply chain
is responsible for over two percent of global greenhouse gas emissions.
Climate-tech and agriculture means biological alternatives
to replace synthetic fertilizers.
Precision agriculture that uses data
to give each piece of land its optimal treatment
and improvements in the fresh produce supply chain to reduce waste
and minimize the distance that food is transported.
It means plant- and cell-based protein,
automation across all steps of the value chain
and inventory management.
Next is industrials and manufacturing:
a $65 trillion market which accounts for approximately 25% of emissions.
A decades-long shift from analog to digital
is enabling companies to manufacture more efficiently and do more with less.
A key driver here is the explosion of Internet-connected devices,
from just 40 million in 2011 to over 6 billion today.
Now, climate-tech in industrials and manufacturing
means robotics and automated equipment
to drive more efficient warehouse operations,
augmented reality systems that help humans do better work
reducing errors and wasted output,
sensors that detect equipment malfunctions prior to failure
allowing for preventative maintenance that extends equipment lifespan,
apps that make our phones increasingly powerful
and able to take on tasks that previously needed dedicated devices
and cleaner processes to produce everything from cement to steel.
The most recent sector that we have embraced is retail and e-commerce.
Fashion is responsible for over 10% of global emissions.
One-third of all apparel products are never sold,
and every year 21 billion pounds of unwanted retail products
end up in landfills.
Climate-tech in retail means technology to better understand consumer preferences
so that we only produce what people actually want,
more durable materials so that clothing can last longer,
processes to make reselling and reusing clothes easier
allowing products to be used until the end of their usable life,
and effective supply chains to redirect return products
to those who can best use them.
I’m sharing these examples with you all today
not necessarily because we are confident
that we’ve identified all the best opportunities in climate-tech,
but rather to showcase the broad range of sectors and technologies
that are a part of the picture.
We are constantly exploring new possibilities as well.
So here are a few that we find particularly promising for the future.
Carbon markets across all sectors of the economy.
More than a third of the world's largest publicly traded companies,
from Amazon and Google to Shell and Exxon, have net-zero targets,
up from just a fifth a few years ago.
These companies and many more who will set targets in the years to come
need help with carbon accounting, understanding how much they're emitting,
where these emissions come from and how to reduce them.
Many are also interested in carbon offsets including removal technologies
that can actively absorb carbon from the atmosphere
and store it in permanent reservoirs.
Carbon markets are fairly new,
but nearing almost a trillion dollars of value
presenting a large and growing opportunity.
Another example is the future of work.
Many of us spend more than half of our waking hours working.
Where we work and how we work has a massive impact
on our personal carbon footprints,
because everything from our transportation infrastructure
to the buildings we occupy to the habits of day-to-day lives
are shaped by our working habits.
We are exploring what climate-tech means in this space
and how to make the future of work more sustainable.
Think back to when the Internet was first invented.
There was a small subset of Internet companies
and Internet investors separate from much of the rest of the economy.
But if you fast-forward to today, the Internet permeates everything we do.
It touches on every sector and almost every business.
A similar transition is happening
and will continue to happen in climate-tech
because everything that we do impacts and is impacted by climate.
A key to the success of this transition
is that the future it creates must be better than the present.
While charity and altruism play important roles in our society,
they will not be able to scale to the magnitude of the climate challenge.
Policy and regulatory frameworks also provides crucial scaffolding
but aren’t sufficient.
Our best chance of success is building profitable businesses
that can scale with positive unit economics
and customers that love the product,
businesses that are great financially and great for the environment
aligning self-interest with planetary interests across sectors.
We believe that while there may be some growing pains in the short term,
the future with climate-tech ultimately will be not just greener but better,
more dependable energy, faster and more pleasant transportation,
tastier and healthier food, higher quality products,
and more enjoyable work.
Another key to success for such an economy-wide transition
is that everyone needs to be involved.
This can mean starting companies,
transitioning the business processes of existing companies,
making sustainable choices as consumers, influencing regulators
or investing in and helping to build
the next generation of innovative technologies
across a wide variety of industries.
Ultimately, in order to be successful in an enduring way,
the future of climate-tech must involve both everything and everyone.
(Applause)
[The future of climate-tech will involve both everything and everyone.
- Valerie Shen]