Su$tainable Mobility, Volume 17 ⚡️
This newsletter aims to separate the signal from the noise for making money in all things sustainable transportation: Electrification, mode shift, active and public transit, and mobility aggregation, across both people and goods movement.
This week we have a Deep Dive on insights from this week’s State of Climate Tech 2021 from PwC.
Disclaimer: This newsletter represents individual thoughts and not those of any employer. I will always disclose when I have a financial relationship with a company cited.
🅿️ Curbivore is coming to Los Angeles on January 28! The pandemic has caused a surge in demand for curb space and now cities are left wondering how to equitably dole out space to everything from outdoor dining and last mile delivery to ridehail, micromobility and delivery robots. Get $100 off your ticket with the promo code ‘FriendofAlex’.
QUICK HITS: Fast takes on notable news from last 2 weeks
🅿️ Toronto is replacing parking mimimums with parking maximums, but is considering a ban on sidewalk robots. You win some, you lose some. The new parking rules will have excellent long term impact in Toronto, including for shared mobility startups. Sidewalk robots aren’t gone for good, either. There’s just a lot issues to be worked out.
💰 The US Office of the Comptroller is evaluating climate financial assessments and disclosures for banks. It’s a matter of when, not if, and would have huge ripple effects for industries tied to oil & gas and logstics, among others.
🛣 Austria kills a major highway project, citing climate impact. A good example of when climate considerations can lead to the demise of an (unnecessary) infrastructure project.
🚲 Dockless bikeshare programs are a complement to public transit, not a competitor. This further bolsters the argument for public funds to subsidize bikeshare programs.
🏭 Rivian announced another US factory in Georgia and continues the hunt for their European factory. That would bring Rivian’s factory count to 3. For context, Ram-owner Stellantis has an enterprise value about half that of Rivian, but has 52 factories globally. That’s a lot of future earnings baked into Rivian’s valuation.
🧪 Tesla has quietly become the first volume seller of EVs with lithium-iron-phosphate (LiFP) batteries in the US. Other OEMs are sure to follow, eager to manage their dependence on the cobalt used in more dominant battery chemistries.
🏍 Uber and Opibus partner on plan for 3,000 e-motorcycle fleet in Africa. This further underscores how Africa (particularly east Africa) and India are edging ahead of other markets for the most promising e-motorcyle activity in assembly and business models.
💨 DoorDash ultrafast delivery service will rely on employees, not gig workers. The precision for “instant needs” delivery may not compatible with the more laid back gig approach.
🥤LA-based “instant needs” delivery startup is relying on e-scooters. Vehicle form factor is an increasingly important differentiator for last mile delivery.
🚛 Trucking heavyweights Volvo, Daimler and Traton (VW) form heavy-duty truck charging JV for Europe. Another sign that vehicle OEMs are understanding the vital role they play in the charging network. Hopefully this comes to the US as well.
🚙 Toyota belatedly goes electric. Toyota claims that charging infrastructure is one of the key barriers to scaling their ambitions further. Interesting in light of the above, as well as the general approach of Tesla and Rivian to make the charging network a competitive advantage.
🤖 Legislators and regulators are asking more questions about Tesla’s self driving testing approach. New York Times exposés won’t change Tesla’s approach, but regulation will.
⛽️ California will continue to fund hydrogen fueling stations for passenger cars for a while. Will anyone use them?
STARTUP WATCH: Sustainable mobility startups (generally pre-seed or seed) to keep an eye on
👩🦯 Biped (Switzerland): Smart mobility assistance device for the visually impaired
☀️ EV Solar Kits (Texas, USA): Hyper portable solar panels for EV charging
🏍 Kiri EV (Kenya): Assembly and sale of e-motorbike w/battery swap
Deep Dive: Insights from the PwC State of Climate Tech 2021 Report
Now in its second year, the PwC report aims to take a bird’s eye view of cleantech investing. It’s worth a read. My takeaways:
Right now, investing in cleantech means investing in sustainable mobility.
The outsize, later stage investments in startups like Lucid and Rivian don’t yet have a cognate in, say, building decarbonization.
Source: PWC
It’s easy to lose sight of the importance of business model and policy innovation.d
I like this report, but it’s very heavy on the notion that investment dollars is what will drive decarbonization. We absolutely need to be scaling our investment dollars (public and private sector) faster in cleantech, but taking an overly R&D-centric approach ignores the huge potential impact that business model and policy innovations can create.
In mobility, for example, I would argue that the single biggest GHG impact we can have at this stage is to encourage the shift away from single-occupancy vehicle trips. That’s fundamentally less about R&D and more about policies (e.g., congestion pricing, parking minimums) and business model innovation (e.g., mobility aggregators, trip- vs subscription-based mobility models, etc.).
The definition of VC isn’t evolving as quickly as it needs to.
I was struck by a phrase in the report that “more patient capital from VC [emphasis added] is still required to deliver future breakthroughs in climate technology”.
We ask startups to innovate on business model, while the VC side has largely been stagnant in approach since the 1970s. Yes, Breakthrough Energy Ventures has a 20-year fund (as opposed to, say, a 10-year fund) and Sequoia has promised a permanent fund approach. And novel financing solutions like Enduring Planet’s revenue share model are fantastic.
But I’m struck by the conscious choice of the word VC (venture capital) above; it’s broad in denotation but quite narrow in connotation. I hope that in far less than a decade we will have a better phrase for the hundreds of variants on early stage risk capital.
