Silicon Valley and climate change: Big Tech plays critical role in addressing climate change

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  Quantumrun Foresight
• June 16, 2022

Insight summary

Facing climate change, many social-minded entrepreneurs are launching startups to develop technologies aimed at reducing global carbon emissions. This growing focus on green technology is drawing in skilled workers and students, expanding the field and potentially leading to new, important discoveries. The cooperation between new companies, established corporations, and governments, fueled by increased funding, is creating a strong support system for continued development of climate-friendly technologies.

Silicon Valley and climate change context

Climate change is the defining challenge of the 21st century. Fortunately, this challenge also represents an opportunity for social-minded entrepreneurs who are launching new startups and developing new technologies focused on reducing global carbon emissions. As nations worldwide adopt zero-emissions technologies into their multi-decade energy and infrastructure roadmaps, such investments are also forecasted to create more billionaires between 2020 and 2040 than were previously created across human history, with many of these new billionaires emerging from outside the US.

According to a PwC research report published in 2020, global climate technology investments surged from USD $418 million per year in 2013 to $16.3 billion in 2019, outpacing the growth of the venture capital market by a factor of five during this period. The world transitioning towards a greener future has created a context where heating and cooling systems, agriculture, mining, manufacturing, and industry are all ripe for reinvention.

Venture capital funding will be critical to commercializing the new technologies that emerge to address climate change. For example, Chris Sacca, a former Google special projects lead turned billionaire investor, established Lowercarbon Capital in April 2017 to fund new ventures focused on removing carbon dioxide from the atmosphere. A sizable portion of the fund’s investments has taken place in San Francisco or in companies based in Silicon Valley.

Disruptive impact

The trend of more money being put towards fighting climate change and reducing carbon in the air is likely to encourage many people to start companies aimed at protecting the environment. This financial support, along with the promise of future deals with governments, creates a welcoming space for people to come up with and use important technologies to fight climate change. This combination of making money while doing good is likely to help in finding key technologies that might significantly help in reducing the effects of climate change.

As success stories from the green technology area become known during the 2030s, they're likely to attract many skilled workers and scientists to this growing field. This wave of skilled individuals is important as it brings in a mix of ideas, solutions, and the needed talent to speed up the creation of green technologies. At the same time, more students might choose to study subjects that are important for fighting climate change, like biotechnology, renewable energy, and chemical engineering. This trend can be beneficial because having many educated workers is essential for coming up with new ideas and eventually bringing climate-friendly technologies to the market.

On a larger scale, the effects of this trend will probably reach governments and big established companies, too. Governments, seeing the benefits of green technologies, may provide more resources and make supportive policies to help grow this sector. Established companies might also change or grow their work to include green technologies, to stay in line with new rules and to meet the increasing demand from customers for eco-friendly practices. This collaboration amonog new companies, governments, and established corporations could create a strong system that supports continued creation of new ideas, helping to build an economy that can withstand climate challenges. 

Implications of venture capital increasingly funding climate change mitigation startups

Wider implications of new companies being started to address climate change may include:

• Climate change becoming an increasingly central issue during national elections due to a growing number of green tech companies promoting their efforts to the public.


• More governments investing in private sector solutions to climate change in place of meaningful policy reform, effectively outsourcing the response to climate change to companies.


• A significant percentage of new startups by the early 2030s will involve applying green solutions to existing technologies, i.e., Existing Technology/Industry + Green Tech = New Green Startup


• A follow-on effect spurring more venture capitalists to invest in climate change-related ventures.


• An increasing percentage of new job growth stemming from green technology-related companies and industries. 


• Increased job opportunities in sectors like materials science, renewable energy, cybersecurity, and carbon capture technology.

Questions to consider

• How can governments better support private industry in creating new technologies to address climate change?


• Do you think that only the elite will be able to establish startups that address climate change due to their access to capital? Or is climate change entrepreneurship open to all persons?