The Opportunity That Corporations Can’t Afford to Miss

The Funding Conundrum for the Cleantech Startup Ecosystem

The challenge facing SSOPs lies in balancing a mix of private and public funding sources. Private funding such as corporate partnerships, startup fees, and return on equity have not proven to be sufficient enough to match government grants. In a survey conducted in 2020, the Deep Centre observed that “a significant majority (88%) of BAIs (or SSOPs) receive some revenue from corporate partners and that this revenue constitutes an average of 17% of the overall revenue mix for BAIs.” (Deep Centre, 2020). SSOPs in the Cleantech space tend to be more reliant on public funding than others given the capital-intensive nature of the startups that participate in their programs, which typically results in the need for long-term support. As a result, reliance on government subsidies has slowed the development of service offerings for entrepreneurs.

Corporations as a Lever to Accelerate the Development of the Cleantech Space

To accelerate their development, SSOPs need to increase corporate involvement in the Cleantech sector. Although most established corporations see an interest in participating in Cleantech innovation as a whole and in growing the Cleantech space, they typically seek out benefits for their own organization as well.

  • Greater velocity in the commercialization of innovations.
  • In-depth business intelligence on innovations in key sectors.
  • Pollinate the entrepreneurial and innovation culture.
  • Create value, such as additional revenues and investments in emerging innovations.
  • Accelerate implementation of technologies to reduce greenhouse gases.
  • Create a strategic investor practice (corporate venture capital).
  • Obtaining C-Level buy-in from the get-go on the benefits of an open innovation project.
  • Identifying key strategic challenges — and getting executive buy-in — to submit to the startup ecosystem.
  • Generating a strong startup funnel and selecting the applicants who have the best product-challenge fit.
  • Managing expectations on deliverables for both executives and startups.

The fight on climate change can only be successful through key technological innovation and significant collaboration efforts across the business world.

Unlocking the Full Potential of the Virtuous Circle

Without a doubt, corporations have a huge influence and role to play. They have the power to unlock a virtuous circle of collaboration that will benefit not only themselves and secure their business continuity, but also propel the Cleantech ecosystem and increase the number of emerging startups.

Patrick Gagné, CEO at Cycle Momentum

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Cycle Capital is an impact investor and a leading private cleantech venture capital investment platform with $ 0.6 billion under management.

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Cycle Capital

Cycle Capital

Cycle Capital is an impact investor and a leading private cleantech venture capital investment platform with $ 0.6 billion under management.