Funding to climate tech companies continued to trend down in Q4’23, despite deal counts remaining steady.
However, as deal sizes have gotten smaller, the space has seen a corresponding shift toward early-stage dealmaking. In 2023, 69% of climate tech deals went to early-stage companies — an increase of 14 percentage points vs. 2022.
Using CB Insights data, we break down the climate tech landscape and the markets and startups seeing the most traction.
Below, we cover:
- The recent low in climate tech funding
- The drop in $100M+ mega-rounds
- The relative resilience of climate tech valuations
- The shift toward early-stage deals
- Which category is seeing an influx of funding
- Which category has struggled to draw investor dollars
- The companies that raised the most equity funding in 2023
- 2023’s top climate tech investors
We define climate tech as technologies designed to mitigate or reverse the effects of climate change. This includes everything from renewable energy and smart grid tech to emission-reducing technologies in transportation (e.g., electric vehicles) and agtech (e.g., precision farming).
Funding to climate tech companies fell in Q4’23 to a 3-year low, representing a 44% QoQ decline in funding and a 64% decline from the peak in Q4’21.
Deals have remained relatively consistent, however — pointing to sustained interest in the sector at a time when venture dealmaking more broadly has suffered.
