In parts, the investment well is drying up. In 2022, startups across the globe collectively raised US$445 billion, which represents a 35% drop from the previous year of US$681 billion. Investors, in short, are tightening their belts in anticipation of a prolonged economic slump. The one area that has proven resilient to this funding climate is - appropriately enough - climate tech.
Over the past few years, we’ve seen a surge of venture capital funding into climate tech. Since the beginning of 2022, climate tech has raised over US$1.68 billion, including players like Xpansiv, Arcadia, and WeaveGrid. In the last three years alone, almost $100 billion has been invested across sectors such as renewables, energy storage, mobility, agriculture, the circular economy, among others.
What is notable about these climate tech companies is that they are primarily enterprise rather than consumer. One reason for this growth is that there is greater pressure on brands to not only ensure their own operations are sustainable, but that all partners in their ecosystem are, too. Achieving this goal will require the use of many enterprise products, tools and services.
This idea is especially evident in real estate. In a survey of global landlords conducted by The Proptech Connection, 48% of respondents noted they were investing in technology solutions driving sustainability, 52% in those driving portfolio visibility, and 65% in technologies supporting occupier retention. This level of investment is telling; property owners are willing to invest in solutions that drive the things that matter.
Here at CIM, we’ve been fortunate enough to experience this growing commitment to game-changing technology first-hand. Our PEAK Platform delivers a number of high-value benefits for property owners and managers, none least the three aforementioned. In September last year, we were successful in raising an AU$6.6 secondary traction on the heels of a AU$10 million Series A just a month earlier for our property operations software solution. As another nod to our recognition in the tech space, we were awarded the Climate Tech Impact Award at the Climate Tech Festival in December.
Both our fundraising and our industry recognitions are rooted in the fact that our solution is gaining significant traction across the globe. Across our coverage of 10 million square meters of real estate spread across 15 countries, we are already more than 25% of our way toward eliminating one gigatonne of emissions, and more and more enterprises are turning to us for assistance. Property owners, in short, are eager for advanced solutions that advance their commitment to sustainability.
There’s no denying the boom in climate tech investment and product uptake is real. So why would players in the property space be remiss to turn a blind eye to this movement?
- The solutions are more impactful than ever before. Climate change solutions are no longer what they were a generation ago. Due to the greater investment into the space, the products are more sophisticated, which elevates their effectiveness and price. Paired with the evolution of the tech stack, these solutions can exert a much greater and broader impact than was previously possible. CIM’s solution, for example, has quickly evolved into a best-in-class building analytics SaaS technology. Its vast library of advanced FDD algorithms which continuously monitor all building equipment continues to grow, while we augment the solution with new features that provide even greater benefit to its users.
- These solutions represent competitive advantage. In terms of the product adoption curve, we’re still probably at the early adopter stage with climate change solutions. The brands adopting these are some of the most forward-thinking in their respective industries. By integrating these solutions, they gain competitive advantage over their peers. These organizations can optimize use of their building assets, improve operational performance, and progress toward sustainability, all of which translates into real world value. Conversely, the brands who fail to turn to these solutions will fall further and further behind, especially as the early and late majority buys in. If a brand is a laggard in this area, they will be out-performed by more and more of their peers, and fall behind as a result.
- These solutions attract and keep tenants. Since sustainability is a near-universal concern of enterprises, one way to cater to this target audience is developing greener properties. Doing so will bring property owners and operators the same influx of customer satisfaction that climate tech startups are already gaining in droves. Improving sustainability will help with not only acquisition, but retention. Employees who work in green offices and buildings are happier, more productive, and even stay with their organizations for longer tenures. When brands experience these benefits first-hand, they are likely to remain with a property for the long-term.
In the end, property owners should not treat ESG efforts as a token initiative, one designed to temporarily appease stakeholders. They should strive for genuine commitment to the space, using the new crop of climate tech solutions as a key driver. By doing so, they will create lasting value for their business, their partners, and their end users, and do so sustainably.
To unleash the power of an award-winning climate tech solution for your property or portfolio, discover the PEAK Platform. Watch a demo today.