Discover Zero Carbon Capital | With Pippa Galwey, Founding Partner

Size and horizon:  £30m targeted, £10m closed. 10 year duration. 4 year investment period with a target of returns in years 7-10. Target IRR of 20%.

Focus: Deep decarbonisation is a cross industry challenge so we invest in areas as diverse as agriculture, transport, industrial processes and the built environment. Our focus is on solutions that can drive an annual reduction of 500Mt CO2e emissions by 2050. We also explicitly target companies with transformational innovations that are grounded in the physical sciences.

Geography: Europe and Israel, with a primary focus on the UK.

Maturity/stage: Pre-seed and seed / pre-revenue.

Ticket size:  £100k to £1m initial cheque

Potential lead: Yes

Follow on: Yes within our active investment window (first 4 years)

Previous Investments: Biozeroc (New Materials), Phycobloom (Alternative fuels), Ionate (Energy), Multus Media (Cultured Meat)

How would you describe your VC and your investment thesis/guiding principles in one sentence?

We back extraordinary early-stage companies building innovative, scientific solutions to the biggest, hardest challenges of decarbonisation.

Can you tell us a bit about yourself and the main partners in the team?

I’ve been investing in and working with startups in the deep decarbonisation space for over 6 years, first in the US and now in the UK. I studied engineering at university and spent my career at the intersection of technology, innovation and business, first in financial services, then in tech. Having decided that I really needed to be working to avert the disastrous consequences of climate change I realised that there was an opportunity to take what I had learned and use it to help scientific entrepreneurs build the solutions we need to the hardest problems.

The other GP at ZCC is Alex Gawley (who’s also my husband). Prior to ZCC he led product and engineering teams at Google for 10+ years and built their internal incubator, Area 120. He’s also a scientist by education, and loves to go deep on the technical aspects of both the challenges and solutions we look at.

Both Alex and I are lifelong learners. We love that this job gives us the opportunity to work with amazing, ambitious people that can teach us as much as we can help them.

Why do you think now is the right moment to launch this fund?

Ultimately, the scale of the challenge facing us and the ticking clock associated with continued emissions of greenhouse gas emissions means that we feel there is a real imperative to act here, both morally and commercially. We’ve seen a big positive change to the attitude of investors and LPs toward climate tech solutions over the last few years, but there is a massive wall to climb and we still need a huge amount more company formation and capital to make real headway.

Do you lead investments and do you have any typical deal terms?

We do like to lead where we think we can add significant value, especially in the earliest rounds we get involved with. We try to keep our deal terms pretty standard, but we do insist on board representation when we lead as we want to be deeply involved in helping the company to grow and get to the next stage.

What is your unfair advantage? What do you bring besides money?

I think there are a few things that set us apart. First is that, because we are both technically inclined and love to go deep on science, we are able to invest earlier than many other funds in this space. We are willing to really understand the scientific risk and how that might play out with market dynamics. We’ve also been working with scientific founders to build companies for a long time and have a good sense for what it takes to go from the lab to Series A. Finally, we’ve worked hard to build a really deep network of investors and advisors across Europe, the US and Asia that we can work with to build long-term success for our portfolio.

What do you look for in entrepreneurs? / What will convince you to invest in a startup?

The first and most important attribute in any founder is passion. We want to work with people that are obsessed with solving a problem, and driven by a deep intrinsic motivation. The second thing is that we want to work with founders that are truly exceptional when it comes to their field of expertise. They understand the problem, solution space and market better than anyone else we know and are constantly striving to learn more and integrate it into their perspective. Finally, we look for potential. I like to think about this as capacity to grow. Ultimately every day at a startup will present challenges that you’ve never encountered before. You can’t be pre-prepared for all of that. You have to be able to learn as you go. And you have to love doing that.

Can you give a few examples of startups you previously invested in and why?

You can see all of our investments on our portfolio page and it’s always hard to single out specific examples since we are so proud of them all. Our most recent investment was in Biozeroc. They are using bacteria to create cementitious material that can replace cement in concrete. Concrete is the second most used material on Earth after water and the cement in it is responsible for 8% of global emissions. Biozeroc has the potential to reduce that to zero (and maybe even go negative). Ultimately we invested here because we love the founders, Liv and John; we see the scale of the problem; and we are excited, in general, about the idea of replacing current high temperature chemical processes with biological alternatives.

What is the best way for founders to approach you and what will convince you to have a first meeting?

We want to see and help as many relevant companies as we can. We have a place on our website where folks can connect with us and share information about their company and we try to be as visible as possible at every industry event we can get to. In terms of getting that first meeting I think it’s all about being clear about why you think we’d be a good fit for you and why we’d be excited to work with you. That means helping us understand the scale of the challenge you are working on and the unique way in which you are going to be successful.

What is one advice you would give deep tech entrepreneurs? 

When you choose to found a deep tech company, you are also signing up to become a science educator. You need to get really good at explaining the problem and your solution as concisely and accessibly as possible. Most people are drawn to stories, and you need to shape your passion and knowledge into something that will draw in their emotions.

Who are your LPs and how did you convince them to invest their money in deep tech?

Our LPs are a rather private group of people! I can say that our first close was led by two LPs, one of which was Extantia, who invested out of their climate tech fund of funds. One thing we are very excited about is having a group of LPs that range all the way from individual investors making their fist investment in an LP fund up to large institutions. Anything we can do to bring more capital of any stripe into the fold is a positive.

What do you think will be the next big thing in deep tech? 

In deep decarbonisation we are seeing a really big wave of companies using biological solutions to replace existing high-temperature industrial processes. Fossil fuels made heat cheap, so many of the improvements of the last 100 years of industrial processes involved making stuff hotter. It’s hard to do that with renewable energy so we need lower temperature alternatives. Fortunately there is almost nothing we have invested that nature doesn’t already do at some scale and at body temperatures. So the combination of computational biology and industrialisation of biological processes is a real opportunity to solve some very big decarbonisation problems.

What trends are you seeing in the deep tech investment landscape?

We love that deep tech entrepreneurs are really lining up to bring their expertise and passion to some of the big unsolved problems. I feel that the pitch decks we have seen over the last few years have really deepened from energy efficiency and digital tech plays, to taking on the less obvious and harder-to-hit areas, like industrial heat, concrete, heavy transportation and soil carbon loss. These are the areas we are most keen to invest in.

Head to Zero Carbon Capital website for more info.

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