I consider myself a research capitalist – finding, co-investing and developing the most impactful technologies to solve climate change. I currently lead a cleantech program at a Canadian national laboratory, and my job is to find the best research ideas to invest in and co-develop. As with many breakthrough technologies, many projects involve exciting startups with founders fresh out of academia trying to commercialize their postgraduate work. I’ve seen new companies develop new lightweight sustainable polymers, or a process to make vegan leather, or a catalyst that produces clean hydrogen. Everyone believes that their solution will save the world.
The good news is that climate startups are attracting investment like never before. Last year was a banner year for climate venture capital investments with over $40 billion in funding allocated. There’s never been a better time than to start a business or join a startup based on academic sustainability research. But how do you get an idea from the basement lab to an investor?
Assess the potential for impact
So how do you assess which projects developed in academia will have the most impact on commercial programming? I first evaluate the technology based on four metrics:
- Total Addressable Emission Reductions: If implemented at scale, can this technology address 1 gigatonne or more of CO2 emissions per year? A CO2 capture process that embeds carbon into concrete could decarbonize the entire built environment, a sector that emits a large number of emissions. On the other hand, the market and emission reduction potential of vegan leather is much more specialized.
- Technology readiness level: Is it just an idea or has it been developed as a proof of concept? What will it take for this technology to scale and how does it fit into the current ecosystem.
- Current cost and potential cost savings over time: At the end of the day, you can have the best emission reduction technology, but if it’s too expensive or provides no value, no one will buy it. Understanding what a potential business model for new technology is – who will buy it, for how much and why – is key to making an impact.
- Looking for support or similar: The competitive landscape is also an important factor. Many innovators think what they have is unique, or best in class, when in fact there is something that already solves this problem.
Build a business plan from your research
If the idea or project passes these metrics, the next step is to turn that idea into a business.
You need to start asking the hard trading questions instead of the scientific questions such as what is the state of the market? How does this technology bring value? How much will it cost? Who will buy it? Why are they going to buy it?
Take your research and build a business model canvas to help understand the big picture of what your research is and how it can be important to the world. Often academics can get lost in the details. Instead, think about how to apply your work to the real world and how to turn your research into a product or service.
Let’s take an example of a business model canvas that I built when I was trying to take my PhD work from lab to startup during the Carbon XPRIZE competition. We were developing new catalysts to electrochemically convert CO2 into renewable fuels and chemicals.
The vision was simple, imagine a world where we could source the fuels and chemicals we need to make plastic and other essential materials not from fossil fuels in the ground, but from CO2 in the the air.
Take a look at the business model canvas for this idea below.
Learning to pitch and what it means to you
Now that you’ve made a business plan, you’ve thought about the importance of your research and how it can make money. This creative exercise is a practice of transition from academia to private industry or the public sector.
As an academic, developing a business case helps you contextualize your research and makes it easier for you to communicate its benefits and possibilities to others.
An effective pitch has three parts and largely follows the classic story structure. Once upon a time this problem, I worked on this solution, because of this solution, the world is a better place.
Academia produces highly technical and specialized people whose greatest strength is not subject matter expertise, but rather their ability to think critically and test hypotheses. To reach net zero by 2050, we need people who can take multidisciplinary and collaborative approaches to solving one of the toughest and most complex problems and who can communicate across multiple topics. Those educated in academia have these traits, they just need to learn how to show it to the rest of the world.