Trellis Climate aims to bridge the 'commercial valley of death' for climate tech | TechCrunch

Trellis Climate aims to bridge the 'commercial valley of death' for climate tech | TechCrunch

Let's say you're a founder who started a company based on a cutting-edge technology that can make hydrogen cheaper and faster than anyone else — so fast and cheap that you've just launched your first round of fundraising. Traveled in several trips, from which tens of millions of dollars work to prove it. And it does better than expected.

Now all you have to do is build a commercial-scale plant, a so-called first-of-its-kind facility. Some call it the “commercial valley of death,” and it's where many climate tech startups struggle. Because no one has undertaken such a project before, financiers are usually reluctant. There are many unknowns.

Environmental non-profit Prime Collision With a new program hoping to bridge the gap, Trails climate.

Prime Coalition has long taken a different approach to climate finance than its for-profit brethren. This makes it normal. Venture-style investment Through its Prime Impact Fund, it also helps startups and philanthropists direct their money to climate-related projects it deems high-impact. Trails Climate follows the latter model by focusing on the middle stages, where capital has been depleted.

“There are more and more philanthropists who are really interested in solving the climate problem,” Laura Pierpoint, director of Trails Climate, told TechCrunch.

“The greatest, best use of philanthropy is in trying out new ideas, in actually fencing things that have the potential to have a huge impact,” he added. “It's the most flexible and potentially risk-averse set of dollars out there.”

For climate technology founders, such funding is welcome news. Early-stage founders have a wide range of capital to tap into, from multiple venture capital funds to federal grants. That may not be enough to prevent the planet from warming more than 1.5 degrees Celsius, but so far it's been enough to prime the pump and keep climate technology investors busy.

One assumption has been that once climate technologies are proven, “then corporations and industries will scale those technologies,” Pierpoint said. “On the corporate side, a lot of companies are really being forced to do things that create immediate shareholder value.” As a result, there is a wide gap in between.

“We strongly believe that philanthropy is a catalyst, but the goal is to bring in infrastructure investors who are willing to lean a little further on risk,” he said.

The program's first investments include AmpleCarbon, a startup that converts old coal plants to bioenergy with carbon capture and storage, and AbCarbon, an ocean-based carbon removal startup.

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