When it comes to tackling challenges related to climate change, entrepreneurs in the climate tech space are aware of the uniqueness of the problem faced by each market in Southeast Asia (SEA).

In terms of funding, there are also more opportunities available for solutions that focus on risk mitigation.

“[Funding opportunities] talk about how we will solve this problem and build something to solve these problems. Now, speaking from the perspective of air pollution lens, solving the air pollution problem takes 10 to 30 years, even 40 to 60 years,” explained Piotr Jakubowski, Co-Founder & Chief Growth Officer nafas – Jakarta Air Quality, on the first day of Echelon X at Singapore Expo on May 15.

As a co-founder of a climate tech startup that helps detect the quality of air in major SEA cities such as Jakarta, Jakubowski stressed the importance of solving a problem in the long term. Still, there was also an urgency to tackle present-day problems—which he described as “what to do in between”—as the other solutions may take decades to develop and authorise.

“It is something that we need to think about. Our perspective is that we do not just need tomorrow’s solutions to solve today’s problems. We also need today’s solutions to solve today’s problems while we wait for tomorrow’s things to materialise,” he said.

Also Read: Eco-investing: Driving change through climate technology and strategic finance

Between impact and profit

In the panel discussion “Green Horizons: Climate Tech Innovations Solving Asia’s Challenges,” moderator Zal Dastur, Founder and Managing Director at Grange Management, asked the panellists—a mix of climate tech entrepreneurs and investors—how to balance making revenue and creating impact.

According to Ernest Xue, Investment Director at Eurazeo, climate tech investment has had its own ups and downs. In fact, for Eurazeo, there is only one company in the hydrogen space that they invested in that is growing well after the solar power boom in the 2010s.

“I think we are a lot more attuned to the operating and regulatory environment where the companies operate,” he said. We have become more attuned to unforeseen market forces.”

For Vertex Ventures Southeast Asia & India, which is not a climate or impact fund, investing in climate tech has its own meaning.

“We look across all sectors and its potential returns for our LPs. It is the ultimate north star. So, we will not underwrite any opportunity that we do not think can give us outsized returns,” said Pui Yan Leung, Partner at Vertex Ventures Southeast Asia and India.

Also Read: Beyond buzzwords: How climate tech startups can create an impact in green recovery

“What we have done over the years is integrate ESG practices into how we look at investment opportunity. So, for every single opportunity, whether it is climate impact or not, we apply the ESG view to ensure that there are no red flags concerning environmental, social and governance issues … We must believe that the go-to-market strategy is solid enough to capture that opportunity. We must believe that a founder has the right background and motivation to carry out the vision and that the competitive landscape is okay enough for a company to thrive.”

When it comes to the role of government in supporting climate tech investment, how far can entrepreneurs and investors expect help from them?

Nicole Ngeow, Director at Prudence Foundation, believed that, given the complexity of the issues being solved, entrepreneurs and investors simply could not remove the government from the equation.

“In my work experience, the government plays two roles. They could be concurrent roles, or they could be separate roles. The first role is to provide an enabling environment, whether it is through regulations or policies to encourage the green tech ecosystem,” Ngeow said.

“The other role they could play is the implementer because a government is the government; it governs the country. It implements many of the policies on the ground and in the public sector as well. There are things that the government does best, and there are things that the NGO or the private sector can do. But it has to come into a form of collaboration, partnership, and understanding.”

Echelon X was held on May 15-16 at Singapore Expo Hall 2. The event aims to empower startups, investors, corporates, SMEs, government institutions, and other ecosystem stakeholders with tools and insights. This year, it features 150 speakers and four stages.

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