In the landscape of climate technology, innovation is not only about creating groundbreaking solutions, but also about creating an environment where the solutions can thrive. I had the opportunity to speak with Gil Shai, a figure in climate-focused venture capital, and our conversation offered invaluable insights into how the intersection of policy, and entrepreneurship is driving the efforts against climate change. Gil’s journey, from computer science and mathematics to business and investing in climate solutions, offers a unique perspective on the work done within the climate tech space.
One main takeaway from our discussion was Gil’s perspective on the role of capital in scaling climate technologies. He joined Meron Capital, a generalist venture capital firm. Over the past few years, he has made significant investments in the renewable energy space, specifically in battery technologies, and in sustainable food tech, turning discarded agricultural biomass into alternative proteins. Beyond investing, Gil plays an active role in the Israeli climate ecosystem–leading the climate track the Coller Startup Competition at Tel Aviv University, and supporting early-stage climate startups with funding, mentorship, and guidance. Gil approached climate action from the venture capital side, believing he could have a broader impact by supporting multiple companies and shaping the Israeli climate innovation ecosystem. His work exemplifies how entrepreneurs and investors are contributing to meaningful climate solutions.
The Role of VCs
Venture capital firms play a major role in the climate innovation ecosystem, and Gil emphasizes that this goes beyond simply providing funding. While capital is often the first step for startups, the value a good VC brings extends more.
Gil broke it down into two key contributions. First, of course, is the money. For many startups, especially in climate tech, securing venture capital is the only viable way to get off the ground, build a team, and start creating their product or service. But just as important is the second contribution: value. This comes in various forms, such as connecting founders to relevant people in the industry, helping secure follow-on funding from other investors, or introducing them to potential customers.
Some venture capitalists, like Gil, have operational backgrounds, having worked as chief revenue officer (CRO) and chief operating officer (COO). This hands-on experience allows them to offer mentorship and coaching beyond financial advice–helping founders navigate building and scaling a company.
From the Startup Perspective
When it comes to identifying which climate tech startups are most likely to succeed, Gil outlined three essential factors–ones that, as he noted, apply to any startup, not just those in the climate space.
- A large enough market.
- A capable and resilient team.
- A product that fits the market’s needs.
- A product that is also feasible for the team to build or manufacture.
If a startup gets these four elements right, it stands a solid chance at growing its business and reaching a successful exit–whether through an IPO or acquisition.
Gil also pointed out a distinction between software startups and climate tech ventures, particularly those dealing with deep tech and hardware. The life cycle for hardware-based companies tends to be significantly longer than for software startups. Developing physical products often requires more time–not only to build and iterate on the product itself but also to manufacture, distribute, and scale the business. The extended timeline creates layers of complexity that software companies rarely face. Because of these additional hurdles, successful climate tech teams need specific knowledge about this manufacturing process and supply chains–skills that many software-focused individuals don’t have. Gil emphasized that while the core principles of building a great startup remain the same, climate tech requires more patience, specialized expertise, and a willingness to tackle logistical challenges. Ultimately, whether it’s software or hardware, the fundamentals of startup success remain rooted in seeing a great market opportunity and a well-designed product. But in the climate tech space, getting to this end of success is more demanding–and more rewarding.
The Future of Climate-Tech
Gil highlighted several key areas of climate tech poised for growth in the next decade. Energy transformation, particularly in renewable sources, is a major focus. Industrial sectors like steel and cement will also undergo significant changes toward greener processes. Gil believes that adaptation and climate management solutions will grow, addressing challenges like extreme weather events and resilient infrastructure, as climate impact intensifies. While carbon capture and sequestration technologies are advancing, their growth will be more gradual, with a focus on reducing costs for scalability.
Public Policy Influencing Climate Investing
In Europe, Gil noted that regulations have steadily pushed companies to adopt climate tech solutions. The European Union has implemented policies to reduce emissions, such as carbon pricing, emission limits, and penalties for companies that fail to meet targets. These regulations drive innovation and the deployment of existing technologies, creating a growing market for startups and companies focused on climate solutions. In the U.S., the policy landscape regarding sustainability initiatives is shifting due to the current administration. He pointed to the Inflation Reduction Act (IRA) as a key example of U.S. policy supporting climate tech, offering substantial tax breaks and incentives for renewable energy projects, hydrogen companies, and other climate innovations. These incentives and others exist at both the federal and state levels and are vital for encouraging climate tech investment but will change in the next few years. Gil believes that adaptation technologies such as those addressing wildfires, droughts, and extreme weather events–will continue to gain support.
As the climate tech space continues to evolve, it’s clear that the intersection of innovation, investment, and policy will play a pivotal role. Through his work as a venture capitalist and active participant in the climate ecosystem, Gil Shai exemplifies how entrepreneurs, investors, and governments can come together to accelerate progress in addressing climate change. His insights into the growth of key sectors, the importance of strategic investments, and the influence of public policy highlight the interconnected nature of this effort. It’s evident that with the right support, from funding and expertise to regulatory frameworks, climate tech holds the potential to drive change on a global scale.