Matt Toner: It will take capital to move the needle on climate change 

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      Startups solve problems at scale. The bigger the problem, the faster the growth and the greater the return…except, it seems, when it comes to the biggest problem of all. 

      Runaway climate change is the single greatest long-term challenge facing humanity. And with the ability to move at breakneck speeds, disruptive start-up innovation is one of the few ways we can bend the curve downward and away from the possibility of long-term global disaster. 

      So why hasn’t green tech seen the same sort of success, the same sort of sizzle, that is celebrated in other areas of innovation: fintech, cryptocurrency, software as a service, you name it? 

      In my experience, the green tech ecosystem is misfiring because non-economic actors—politicians and policymakers—are rarely able to effect profound positive disruption on their own.

      If we want such change and we want it quickly, we need to instead mobilize capital, tech talent and entrepreneurial leadership to advance the green goals championed by activists. When that combination comes together, it can move the needle pretty quickly. 

      Whether in the form of natural disasters or the latest environmental protest movement, climate change confronts us every day. It reminds us of our own personal consumption choices, as well as the pent-up popular demand for action. The market pressure, and the market, is there. 

      When it comes to effectively motivating government policy, however, market pressure has been less successful. 

      Greta Thunberg, for instance, compelled hundreds of thousands of Canadians across the country to call for immediate action on climate change as the 2019 federal election unfolded. The result? Canada elected a minority government with a relatively mild climate change action plan.

      The federal Green Party went from two seats to three, essentially a rounding error in a Parliament with 338 members.  

      The 2019 election was perplexing failure that seems uniquely characteristic of Green parties across Canada. Had Canadians poured into the streets demanding immigration reform on a similar scale, Maxime Bernier might be crowning himself god-emperor right now.

      Or, less fantastically, the federal Greens could have taken a lesson from the Bloc Québécois, who turned a similar share of the national vote into decisive leverage through a savvier strategy that understood the constraints of our first-past-the-post electoral system, 

      The same is true closer to home, with the less said about the rout of the B.C. Greens in our recent provincial election, the better. They now have four years to reflect on the importance of lost leverage, while Site C construction and the expansion of our LNG megaprojects continue apace.  

      By relying on public pressure generated by activists to produce meaningful policy changes, we have been pushing on string. And with the time running down, we now need to mobilize different resources. 

      Consider companies like Tesla, Zoom, and even Uber and Lyft. Nobody would classify these as conventional “green tech”, yet all have fundamentally changed their industries while starting to make inroads into reducing overall carbon emissions. 

      After only 11 years in the market, Tesla has unquestionably disrupted the auto industry and forced the world’s largest automakers to respond with electric vehicles of their own. Affordable mass-market EVs are now a reality, and that is a huge win for anyone concerned about climate change. 

      Despite its unicorn status, few people had heard of Zoom Video Communications Inc. 12 months ago. The sudden shift to distance meetings has led to an eight-fold increase in its stock price. More significantly, this sea change is also rewriting business travel—a leading miscreant when it comes to carbon emissions—for the foreseeable future. Has anyone calculated what Zoom’s net carbon footprint might be? 

      Uber and Lyft, meanwhile, have redefined urban mobility in less than a decade. Their long game—the end of car ownership, with autonomous electric vehicles offered as service—would be another huge win for those concerned about climate change. Today, the companies are wrestling with net emissions, but their plans for more pooling, faster electrification, and better integration with public transit hubs should quickly push them below the footprint of private vehicles. 

      For this reason, Shred Capital is working with other “green-minded” investors from cities like Copenhagen, San Francisco, and Montreal. Our plan is to knit together early stage capital networks to support the most entrepreneurial innovators, creating a private-sector bridge between policy and procurement.  

      With this in place, we want to start backing startups that have the potential to be next generation of category-killer companies. To see such success will take seven to 10 years… which is not a lot of time when one thinks about the climate deadlines highlighted by the UN Intergovernmental Panel on Climate Change. But then again, startup years are often like dog years. We get a lot done in a short period of time. 

      And here is the good news for politicians and policymakers: the COVID-19 pandemic has shown that there is a real role for them too. Their work in this crisis has shown, with different degrees of success, that government can pivot entire economies and create the market conditions to drive profound innovation at (ahem) warp speed.

      Matt Toner is the former Vancouver-based deputy leader of the B.C. Green party. He has led startups in New York, Toronto and Vancouver, and recently cofounded Shred Capital to seed the most promising Western Canadian tech investments.  The Georgia Straight publishes opinions like this from the community to encourage constructive debate on important issues.