OAlthough valuations are falling, venture capitalists still have money to invest in startups. But does the world need the umpteenth delivery service or another neobank? Charlotte Baumhauer, only a little older than the well-known German climate activist Luisa Neubauer, is also concerned about climate protection. But the mechanical engineering graduate, who had already chosen mathematics, physics and chemistry as her main subjects when she was at the French school in Munich, is not calling for school strikes to protect the climate. She wants to protect the climate with money as an investment manager at Paua Ventures.
The Berlin-based venture capitalist focuses on early-stage financing of start-ups, including in the field of climate technology. There are roughly four areas that Baumhauer considers particularly interesting. There is the area of energy. This includes solar technology, but also infrastructure such as micro grids, small intelligent power grids that ensure a secure and more efficient power supply at the local level and are the smallest unit of the so-called smart grids, which are becoming more important in the course of the energy transition. But the storage of energy is also an important field, says Baumhauer.
Furthermore, start-ups in the field of alternative fuels or green methanol from biomass are of interest. Likewise, the recycling of batteries used in e-cars or founders in the meat alternatives sector, such as the cultivation of plants that CO2 absorb from the atmosphere. “These are primarily young companies from the Deep Tech sector, i.e. start-ups that either have to carry out extensive research or produce the devices and machines,” explains Baumhauer. The investment manager at Paua Ventures knows that venture capital is just one ingredient in the development of a company.
In order to gain the favor and money of venture capitalists, however, green start-ups also need what delivery services and neobanks also need: a convincing team and a functioning business model. That’s why Paua Ventures invested in the company Carbon One, which was only founded this year, which produces green methanol in a new process that requires less heat and pressure and is therefore more efficient and climate-neutral. Baumhauer believes in Carbon One because of the management team. It includes the founder of the dating platform eDarling, Christian Vollmann, as well as Christoph Zehe, who has industry experience, and the chemists Marek Checinski and Ralph Krähnert. “Especially when it comes to technically more complex topics, you rarely see commercial DNA in the team – which is very well covered here by Christian Vollmann,” explains Baumhauer.
She has also convinced that there is already a market. The Danish shipping company Maersk has ordered several container ships that are to be fueled with green methanol instead of diesel. The demand for the fuel must therefore be satisfied, which is not possible with the current production process. According to the investment manager, five million euros have so far flowed into Carbon One, from Paua Ventures and Planet A Ventures and “business angels” such as ex-Linde CEO Wolfgang Reitzle, ex-BASF CEO Jürgen Hambrecht and former SAP manager Jim Hagemann Snabe , who is also currently the Maersk Board Chairman.
But it doesn’t just have to be research-intensive start-ups that arouse the interest of Baumhauer and Paua Ventures. 14 million euros have already been invested in the software company Deed, which was founded in Berlin and New York in 2016. Paua Investments was already involved in the seed round, the start-up financing. Baumhauer explains the business model: “Deed builds a software platform for companies that enables their employees to get involved in the form of activities and donations. There is a strong focus on climate and sustainability projects. Employees can use the Deed platform to take part in challenges, donate money, and get involved in volunteer activities.” That sounds a lot less spectacular at first, but Baumhauer argues that 90 percent of millennials, i.e. those born after 1980, would change employers to work for a company with a stronger focus and commitment to sustainability. Deed is therefore a relevant solution for every company in the world, the potentially addressable market is infinitely large.
In general, the investment manager considers every company that is now being founded to be a green company. Purchasing, production, logistics and sales: All of this can be aligned green and can be caught in the software area. She considers the current definitions of sustainability to be “not really honest” because there are still no central standards. However, venture capital must also flow to founders who develop complicated technologies that require years of research. “There are still too few dedicated funds,” says Baumhauer. Because for the woman in her late 20s it is also clear: “We will not yet reach the 1.5 degree target.” have prescribed.