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Three climate investors walked onto a boat.
That’s not the start of a joke — it’s a description of a panel at Heatmap House, a day of conversations and roundtables with leading policymakers, executives, and investors at San Francisco Climate Week (at the Klamath, a venue made out of an old ship).
Heatmap’s Katie Brigham moderated the roundtable conversation with Prelude Ventures Managing Director Gabriel Kra, Azolla Ventures co-founder Matthew Nordan, and Toba Capital Partner Susan Su. Many of their investments are in moonshot climate technologies that other financial players might avoid.
“Things that look contrarian is kind of what we do,” said Kra. “Occasionally, there’s an idea that looks bad that’s actually a good idea.”
Prelude Ventures funds early-stage climate companies that are “weird, or non-consensus, or counter cyclical, or just ahead of the curve,” according to Kra.
Nordan, for instance, said he backs cultivated meat despite some doubts that the category will achieve widespread popularity.
“I’m presently leading an investment in a company called Pythag Technologies,” said Nordan, talking about the generative AI company focused on lab-grown meat. “It’s actually a really interesting time to invest counter-cyclically in a field like that.”
Like Nordan, Su described her firm as one that is open to unconventional choices.
“We are very weird in that we invest across lots of different categories and lots of different stages,” said Su.
One of her personal investments is in Xeno. “This company does electric motorbikes for commercial drivers, as well as swapping and energy networks in emerging markets, starting in East Africa,” she explained.
The panelists told Katie that opting for less popular investments can be rewarding because they may help fund a major breakthrough.
“We placed a couple of bets on fusion before this current melée occurred that sort of had everybody thinking that, you know, fusion was the next hot thing,” said Kra (who claimed that he intended the pun).
Nordan emphasized the gap that venture can fill, left by larger institutional investors who may shy away from high-risk technologies.
“If there are true breakthroughs out there that just may not be investable by mainstream finance at the earliest stages,” Nordan said, “not because people don’t think they’re really good ideas, but they may be crazy early-stage or kind of weird, or non-consensus, or counter-cyclical, or just ahead of the curve, it would be a real shame.”
