Introducing the 4th annual
State of Climate Tech Report
This State of Climate Tech 2025 explores the key trends, challenges, and opportunities reshaping the rapidly evolving Climate Tech landscape. It provides investors, corporations, and decision-makers with critical insights to capitalize on emerging opportunities and drive the adoption of impactful solutions.
What’s Inside
Introduction
Executive summary
A word from our founders
Key takeaways
A Year In Review
Funding and deal activity
Forces behind Climate Tech
Climate hard tech scaling
Regional climate innovation hubs
Research Methodology
Report scope and definitions
Net0 platform/NZI data
Research methods
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Key Highlights
Early-stage funding contracts as grants cut in half
Pre-seed and seed activity has fallen to a five-year low, pointing to a more disciplined and selective early-stage market. The retreat of grants, incubators, and accelerators has reduced the number of ventures entering the pipeline, while cautious investors demand clearer paths to profitability early on. This tightening is flowing downstream: nearly 50% fewer companies are advancing from Seed to Series A, and 80% from Series A to Series B, compared to 2022.
The new ‘Valley of Death’: Commercialisation
The 2021-2022 investment boom advanced many climate technologies to maturity, but the large majority of companies struggle to turn proven solutions into profitable businesses. More than half of hard tech companies remain at the demonstration stage (TRL 7–8), facing difficulties achieving commercial readiness (TRL 9). Transition times have significantly lengthened to nearly four years from pilot to demonstration and more than seven from demonstration to commercial readiness.
AI emerges as a critical growth lever
AI now serves as the backbone for scaling Climate Tech, both by fuelling capital toward critical energy infrastructure and through AI-enabled solutions. Solutions powered by AI accounted for 27.7% of total climate equity funding in 2025, the second year above the 25% threshold, while data centres and batteries attracted significant investment. Sixty percent of the largest early-stage rounds went to AI-powered materials discovery platforms.
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