Backing early-stage technology companies with innovations that address water risks associated with a changed climate.
Back early-stage technology companies with hardware, software, or business model innovations that support industry and society adapt to a changed climate.
ClimateTech, just not on the decarb side.
The Fund II thesis emerged out of the recognition that while decarbonization (ie: 'decarb') efforts necessarily will continue, the climate is already presenting risks to many industries where water plays a key role, a protagonist.
Our unique insight
Transitioning to a low-carbon economy and adapting to a changed climate are of equal importance. However, unfortunately, the adaptation 'side' has not received the attention it deserves. Yet, whether too much water, too little water, or compromised water quality, the result of increased atmospheric temperatures is forcing industries spanning agriculture, aquaculture, manufacturing, and powergen to adapt to an uncertain water future. Assuming humanity doesn't hit our GHG emission goals, our urgent need will be to focus more on climate-change-induced water risk. A recent piece in Harvard Business Review here highlights the adaptation side of Climate.
Fund II's dealflow*
The innovations Fund II invests in span 3 technology verticals, together known as Climate Adaptation Tech or 'CAT':
Observe: Technologies that allow us to measure, monitor and see how the physical world is changing;
Analyze: Technologies that help us interpret and understand trends and risks in the physical world;
Address: Technologies that affect change on the physical world.
* Many of the companies Fund II invests in might label themselves as ag-tech, water-tech, fin-tech, or prop-tech. From Mazarine's perspective, they are also in ClimateTech, just not on the decarb side.
CAT Framing &Taxonomy
A two-page reference here.
The CAT opportunity
According to a Bloomberg report, Bank of America analysts estimate that the climate adaptation market could be worth $2 trillion a year within the next five years. While agriculture is likely to be hit the hardest, some experts point to real estate, because their fixed locations— valued at $200 trillion worldwide — are uniquely vulnerable to the effects of a changed climate.
Yet, according to a 2021 report from the Climate Policy Initiative, CAT-related opportunities only receive 7% of climate-related investment, spread across a vast spectrum of climate adaptation needs.
What's in a name?
Mazarine refers to this space as Climate Adaptation Tech or 'CAT', but we recognize some investors use terms such as: sustainable or regenerative agriculture, climate science, resiliency, et al. Ultimately, 'CAT' includes any technology that enables industry and society to adapt to an uncertain water future.
Utilizing the ESG framework
Measure impact by applying the ESG framework to score portfolio companies on how their innovation supports their customers’ climate adaptation efforts, which spans E, S, and G.
Fund II typically cuts one check to companies between US$500k ad $5M, but will participate in follow-on rounds as appropriate.
Mazarine is a leader in the movement to invest in the adaptation 'side' of ClimateTech, which aligns well with investors with backgrounds in water/wastewater. Fund II is leveraging the Mazarine team's careers in 'water-tech' and experience across key markets that will be affected the most by a changed climate.
MAZARINE TECHNOLOGY INVESTMENTS L.P.
MTI is backing early-stage companies with IP rooted in sensing, software, analytics, computer engineering, and other innovations that help their customers meet their climate adaptation goals.
First Investment: Q4 2022
Stage: Seed and Series A
Expected Investments: 15
Check Size: $500,000 to $5M
Board Seat: Preferred
Syndicate Participation: Expected
HQ location: North America, Europe, Israel, ANZ
What Fund II looks for
Companies with innovations that improve efficiencies and/or reduce climate-change-induced water or wastewater risks in agriculture, aquaculture, buildings, climate, conservation, financial services, industry, power generation, and/or utilities.
Looking for IP rooted in: Chemistry, Data Science, Diagnostics, Computer Engineering, Information & Communication Technology (ICT), Materials Science, Metagenomics, Microbiology, and Process Engineering.
What problems are the Fund II companies solving?
While their innovations address some aspects of climate-change-induced water or wastewater risk, their customers include a wide range of industries outside of the so-called 'water industry'.
What's out of scope?
Early-stage companies with innovations focused on 'decarb', including: renewable energy, energy efficiency, and/or carbon sequestration. This Fund is in ClimateTech, just not on the decarb side.