I’m Maya, Sifted’s editorial assistant, and I’m going to be pitching in to write this newsletter over the next few months. If you have any tips, climate trends I should be looking into or stories you think I should be covering, you can message me here.
For the last week, I’ve been digging into the companies building energy management software for individual households, large-scale utility providers, grid operators and traders to adapt to the green transition.
The challenge those customers are up against is that traditional energy systems (running off fossil fuels) have been built on the premise that power plants could ramp production up or down to meet demand. This becomes harder the more renewable energy assets come online — you can’t just dial the sun or wind up and down, for example. In response, a new generation of startups are popping upworking on things such as household energy management and grid-level planning.
"As the energy market becomes more sophisticated, managing flexibility becomes more difficult," Giant Ventures principal Will Dufton told my colleague Éanna Kelly inSifted’s Pro briefing on the topicearlier this month.
Elsewhere this week, we’ve rounded up the best reader responses to the question we posed last week on the merits of selling to oil and gas majors.
P.S. when we polled founders last year about how their mental health was holding up, 49% said they were considering quitting — what’s changed in the past year? Let us know in this anonymous survey.
And so does Carbon13's SEIS fund. Their cohort is 25% PhDs, 55% serial founders and the average age is 37. These founders chose Carbon13 as the strongest ecosystem for climate deeptech and its seventh SEIS fund is closing in two weeks.
Risk warning: *Don't invest unless you're prepared to lose all the money you invest. This is a high-risk investment and you are unlikely to be protected if anything goes wrong.*
The sale is part of a wider operation by Northvolt to sell off “non-core businesses” and preserve its core operations.
👕 New EU rules will force companies to bear the costs of food and textile waste, hitting fast-fashion brands and online retailers.
📈 The IEApredicts global energy demand is set to grow by nearly 4% annually through 2027.
Europe's energy landscape was built to manage fossil-fuel based systems, like coal, oil and natural gas. The foundational logic was simple: whether it was a scorching day in July or a bitter winter night, traditional power plants could ramp production up or down as needed to meet demand.
The move away from fossil fuels to low-carbon energy sources like wind and solar in recent years has disrupted this logic; you can’t just dial the sun up or down. This changes how energy systems must operate.
“The world’s vying to increase renewable energy supply on the grid, but the problem is that most of these new renewables are intermittent. So energy supply is more volatile; pricing is more volatile. This is a massive problem to solve,” Will Dufton, principal at VC firm Giant Ventures, told Sifted’s Éanna Kelly ina recent Pro briefing on energy management tools.
Nick de la Forge, founder and general partner at Planet A, tells Sifted that recent geopolitical circumstances have prompted SMEs to pay particular attention to this problem. “The Russian invasion of Ukraine, and according surges in gas prices and therefore energy prices, really shifted the attention of a lot of family-led businesses and enterprises towards energy management as a whole, because suddenly you really had to pay attention to costs.”
Across Europe, a lot of startups have popped up developing sophisticated software solutions to address the challenge, working on such things as household energy management to grid-level planning.
“There are parts of the market that are relatively crowded,” says de la Forge — with software for household energy efficiency the main culprit. But, as he points out, what startups have going for them is that “energy is extremely price sensitive. So if somebody is seemingly able to overperform in terms of price, then this will make customers change.
“‘I think there’ll be some clear winners over time,” de la Forge says.
We're excited to announce our presence on the new social media platform — Bluesky! Join us to stay connected on the latest news and analysis in startup Europe.
🔎 Britain’s security services, MI5, investigate China’s role in the energy sector. Solar panels and wind turbines are among critical infrastructure being assessed for risks of data sharing and strategic control,accordingto the FT.
❄️ A cold winter and Trump’s call for Ukrainian peace talks have left Europe keen to reopen pipelines to cheap Russian gas. But political tensions and supply issues complicate the path forward, The Economistreports.
Last week, we wrote about a founder who sold his previous climate startup to Shell, one of the world’s largest oil companies. That sparked a lot of debate about the merits of selling to oil and gas majors — which tend to be the most active acquirers of climate tech. Here are some of your responses:
💬 We should 100% sell to oil and gas
“Combining climate tech with the massive renewable portfolios held by oil and gas majors under the same ownership means 1+1=3: you can scale the climate tech quicker thanks to the portfolio.”
— Gautier Moulin, cofounder of Norwegian startup Aevy
💬 Only if startups pave the way will oil majors change
"After numerous conversations with a number of majors, what has become very clear to me: oil and gas majors will not drive the green fuel transition or anything else that might hurt the cash cow. What happened with Tesla and EVs will repeat itself with green fuel and the oil and gas companies. The car companies never thought about building EVs properly until Tesla showed up. In energy, a challenger has to come in and make things like green fuels happen at scale and cost: only once traction happens, will the energy majors properly join the race, not before."
— Achim Hoffmann, founder of green fuel startup Ocane
💬 Large corporations will always suffocate startups
"Regardless of industry, large corporations have an impressive track record of suffocating startups — even when they mean well. A former energy firm executive once told me: ‘Every time we acquired a startup, our biggest headache was how to not accidentally kill it.’”
— Emin Askerov, Akari Consulting
Anderlecht, Belgium-based Fyteko, which develops biomolecules to protect crops, raised €13m in Series B funding. Crédit Mutuel Impact led the round and was joined by investors including SFPIM, Supernova Invest, IMBC, Finance&Invest.Brussels, EIT Food and Innovation Fund.
London-based Renew Risk, which provides insights into physical risks affecting renewable energy assets, raised £5m in funding. Molten Ventures led the round and was joined by investors including Lloyd’s and Insurtech Gateway.
Paris-based Cycloid, which specialises in sustainable platform engineering, raised €5m in Series A funding. Reflexion Capital led the round.
Tallinn-based Gridraven, an AI-driven software solution for grid efficiency, raised €4m in funding from investors including Icebreaker.vc and 42Cap.
Barcelona, Spain-based Wattwin, a technology platform that optimises the commercialisation and management of solar energy, raised €3m in funding. Suma Capital led the round and was joined by investors including CDTI Innovación.
Turin, Italy-based Focoos AI, which develops a web platform providing efficient and low-energy consumption artificial vision models for smart cities, industrial production and satellite image analysis, raised €2.65m in seed funding from investors such as Galaxia, PiemonteNext, VCPartnersSGR, VertisSGR, Vento and Exor Ventures.
Vienna-based Elio, an eco-design platform, raised €1.9m in pre-seed funding. Ananda Impact Ventures led the round.
Cambridge, UK-based Flit, which builds folding electric bikes for commuters, raised £1.2m in funding from ACF Investors, CambridgeAngels and TonyPurnell.
Amsterdam-based Proba, an insetting platform to help decarbonise supply chains, raised €1m in funding. Future Food Fund led the round and was joined by investors including Yield Lab Europe and Value Factory Ventures.
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