Bridging the ‘Valley of Death’ for Climate Tech Startups: All Aboard Coalition Raises $300M to Fund First-of-a-Kind Projects
Climate technology startups frequently encounter a significant financial hurdle – often termed the “valley of death” – that lies between seed funding and the growth capital required for proven technologies to reach commercial scale. This chasm is particularly wide for hardware-focused companies, as developing first-of-a-kind power plants or factories can cost tens to hundreds of millions of dollars.
To bridge this financing gap, also known as the “missing middle,” a new fund named All Aboard Coalition aims to secure $300 million by October. This funding will be directed towards helping startups secure investment rounds worth between $100 million and $200 million for building pioneering projects.
Unlike traditional project finance, All Aboard will invest in equity or convertible equity but will not provide loans nor favor specific projects. This approach positions the fund within the venture capital sector.
All Aboard is spearheaded by Chris Anderson, the renowned curator and former head of TED Talks, who is now channeling his network-building expertise towards closing a gap in climate technology investment. The coalition comprises Ara Partners, Breakthrough Energy Ventures, Clean Energy Ventures, Congruent Ventures, DCVC, Energy Impact Partners, Future Ventures, Galvanize Climate Solutions, Gigascale Capital, Khosla Ventures, NGP Energy Capital Management, Obvious Ventures, Prelude Ventures, S2G, and Spring Lane Capital.
While some partners from the firms listed above are investing in the new fund, this is not a mandatory requirement for participation.
The aim is that All Aboard will serve as a catalyst in the sector, with its investments signaling to other experienced funds to follow suit. For climate tech startups navigating the valley of death, additional funding beyond the $300 million raised by All Aboard will be essential, and attracting generalist investors will be crucial for the fund’s success as well as the broader climate tech sector’s commercial achievements.
