A key factor in the slowdown was a sharp drop in funding from mega-rounds ($100M+ deals), which dropped 47% year-over-year (YoY) in 2024. This coincided with high-profile bankruptcies of established climate tech startups like battery manufacturer Northvolt.

However, this turbulence wasn’t limited to the private markets — public players like Lilium and Arrival also filed for insolvency/bankruptcy over the period, highlighting the commercialization challenges facing capital-intensive industries like climate tech.

Download the full report to access comprehensive data and charts on the evolving state of climate tech across sectors, geographies, and more.

Key takeaways from the report include:

• Climate tech investment activity continues to contract. Global climate tech funding fell for the second year straight in 2024, dropping by 40% YoY, with mega-round funding falling by 47%. However, the space still saw notable mega-rounds. This included deals to players modernizing the power grid, drawing participation from tech giants racing to secure clean energy for computing infrastructure.
• Grid tech and nuclear are gaining momentum to meet AI’s energy needs. Within climate tech, markets targeting the grid and power generation show the strongest growth potential, according to CB Insights Mosaic startup health scores. This momentum is driven in part by the massive energy demands (and expected continued demand) of AI data centers.
• Electric vehicle technology sees record pullback in deals. After years of steady growth, electric vehicle (EV) tech deal activity plunged 61% YoY in 2024 — its steepest decline on record. This points to broader challenges in the sector, like lower consumer demand for EVs and increased capital costs for scaling manufacturing operations.
• Climate tech M&A exits decline once again. Climate tech M&A exits dropped by 25% YoY to hit 284, the lowest count since 2020. At the quarterly level, M&A exits steadily declined over the course of 2024, falling from 104 in Q1’24 to 39 in Q4’24. Growing skepticism around environmental, social, and governance (ESG) initiatives could be a contributing factor.

We dive into the trends below.

Climate tech investment activity continues to contract

Global climate tech funding dropped for a second consecutive year in 2024. It fell by 40% YoY, with mega-round funding falling by 47% over the same period.

The funding slowdown played out differently across the globe. US climate tech showed resilience YoY with relatively steady funding despite fewer deals. Meanwhile, other countries saw steep declines in climate tech dollars, with China experiencing the sharpest drop (-66% YoY).

Amid the overall funding decline, climate tech still saw several notable mega-rounds. This included deals in Q4’24 for companies modernizing the power grid:

• Crusoe secured $600M at a $2.8B valuation to support its efforts to use waste natural gas to power large-scale data centers
• X-energy received $500M as it works to build small modular reactors (SMRs) capable of generating more than 5 gigawatts of electricity by 2039
• Form Energy secured $405M to accelerate production of its iron-air batteries capable of 100-hour energy storage

Notably, some of these deals drew participation from big tech companies racing to secure clean energy for computing infrastructure. For example, Amazon (via the Climate Pledge Fund) invested in X-energy’s nuclear development, and Nvidia invested in Crusoe’s sustainable computing infrastructure, reflecting big tech’s interest in solutions that can help meet rising AI data center demands.

Grid tech and nuclear are gaining momentum to meet AI’s energy needs

Comparing median CB Insights Mosaic scores (a measure of private tech company health and growth potential on a 0–1,000 scale) for climate tech companies that raised equity funding in 2024 reveals the most promising markets in climate tech.

Grid tech and nuclear markets — covering technologies directly integrated into and operated by utilities to enhance power system reliability, flexibility, and clean energy integration — dominate the top 10 climate tech markets by median Mosaic score, highlighting their growth potential.

Surging energy demand from AI data centers is in part responsible for these markets’ momentum. For example, nuclear fusion and small modular reactors could provide continuous clean power generation, grid storage enables reliable renewable energy delivery, and virtual power plants help optimize massive power loads.

See 100+ high-potential climate tech companies

Electric vehicle technology sees record pullback in deals

Electric vehicle tech deals experienced their steepest decline on record in 2024, with deal count plunging 61% YoY to 243.

High-profile bankruptcies underscored the sector’s capital-intensive manufacturing challenges in 2024. Battery manufacturer Northvolt filed for bankruptcy a year after raising $1.2B, as it struggled to scale production efficiently. Electric van maker Arrival — which went public in 2021 at a $13B valuation — also filed for bankruptcy last year amid mounting production costs and the inability to raise funding.

Even the auto industry’s most prominent EV champions scaled back their electric ambitions throughout the year:

• GM delayed its Orion Assembly EV truck plant by 6 months and cut 2024 EV targets by 17%
• Toyota postponed US EV production to 2026
• Ford canceled plans to produce an all-electric three-row SUV, pivoting to a hybrid approach instead
• Volvo dropped its 2030 all-electric goal

Climate tech M&A exits decline once again

In 2024, climate tech M&A exits fell by 25% YoY to hit 284 — the lowest count since 2020.

At the quarterly level, M&A exits steadily declined over the course of 2024, falling from 104 in Q1’24 to 39 in Q4’24.

The decline in M&A activity coincided with key changes in market conditions, including the rise of economic headwinds, political uncertainty, and growing skepticism around environmental, social, and governance (ESG) initiatives.

For example, ESG tech markets collectively saw equity funding decline 54% YoY in 2024. On the corporate side, mentions of ESG in earnings calls have trended down since peaking in Q1’22.

As skepticism toward ESG initiatives grows, some companies appear to be placing lower priority on climate tech acquisitions that were previously considered strategic imperatives.

See recently funded climate tech companies with high M&A probabilities

MORE CLIMATE TECH RESEARCH FROM CB INSIGHTS

• Data centers are reshaping nuclear development, driving billions in new power infrastructure investment
• Why fleet management leaders are racing to acquire next-gen telematics capabilities — and which M&A targets could be next
• The AI data center value chain: 12 high-momentum technologies powering the future of AI
• The top 25 utility companies by AI readiness
• Big Tech in Energy: How Amazon, Google, Microsoft, & Nvidia are advancing the global energy transition
• Sodium-ion batteries are poised for a breakout moment — energy players should prepare

For information on reprint rights or other inquiries, please contact reprints@cbinsights.com.

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While AI copilots — which work alongside humans to speed up their workflows — currently comprise 90% of company activity, the tech will serve as a stepping stone to more autonomous solutions in the coming years. Eventually, AI agents could manage entire industrial processes, shifting human roles from operational tasks to strategic oversight.

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Through M&A, leaders like PowerFleet and Element Fleet Management are layering on expanded capabilities that help fleet managers optimize for elements like charging schedules, battery range, autonomous routing efficiency, and maintenance cycles.  

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The AV space has seen equity funding triple this year to $7.5B, and robotaxi services are notching notable milestones — Waymo, for instance, recently hit 150K paid rides per week, 3x the volume from just 5 months prior.

Among key growth drivers, generative AI is helping remove hurdles to widespread adoption, while the potential for regulatory pullback may attract more investors in the year to come.

Source: CB Insights — advanced search for autonomous driving company funding as of 11/13/2024.

In this brief, we highlight potential approaches to tap into the autonomous driving opportunity — including partnering with self-driving stack developers, acquiring or investing in AV assets at attractive valuations, and supplying AV makers with the necessary components to scale.

Here are 4 key takeaways from our analysis:

1. Self-driving stack developers are best positioned for partnership in autonomous driving’s second wave: Waymo and Wayve have led this year’s funding rebound (combined ~90% of equity funding this year) as they make commercial gains and inch toward profitability. Both players are leveraging genAI to improve their self-driving systems and are opportunistically targeting multiple autonomous driving use cases.
2. OEMs are keeping their loss-making self-driving units afloat with fresh capital injections: Despite facing safety issues and commercialization delays, some OEMs view autonomous driving capabilities as strategically non-negotiable, with GM and Hyundai injecting a combined $1.4B in their self-driving units this year. At the same time, they may consider welcoming new financial backers to reduce their risk — creating opportunities for other OEMs to gain exposure to the space.
3. Ride-hailing players can partner with robotaxi companies to mitigate the impact to their business model: Ride-hailing companies are pursuing multiple autonomous driving partnerships at once — Lyft and Uber, for example, have formed a combined 6 partnerships this year. In turn, robotaxi companies should target a similar multi-platform strategy to maximize market reach.
4. In China, autonomous driving players have been pushed to go public at reduced valuations: Companies like WeRide and Horizon Robotics are debuting at prices discounted by 20% or more. The pressure these companies face to demonstrate near-term results represents an opportunity for OEMs and logistics companies to negotiate advantageous terms for strategic partnerships, investments, or even acquisitions.

We dive into each point below.

Self-driving stack developers are best positioned for partnership in autonomous driving’s second wave

After a 2-year funding winter, the autonomous driving space has attracted $7.5B in equity funding so far this year, a 3x YoY increase, driven by massive rounds to self-driving stack developers like Waymo ($5.6B Series C) and Wayve ($1.1B Series C).

Source: CB Insights — advanced search for autonomous driving mega-rounds in 2024 as of 11/13/2024.

Waymo hits key commercial milestones, leading US robotaxi rollout

Waymo has been hitting significant milestones this year, tripling its number of weekly paid rides from 50K in May to 150K in October. It has emerged as a competitor to ride-hailing giants in a few US cities, although its volume pales in comparison to the ~5M weekly rides offered by the likes of Uber and Lyft in NYC alone.

Waymo has also made progress toward profitability, with Sundar Pichai, CEO of Waymo parent Alphabet, highlighting significant cost reduction during Alphabet’s Q3’24 earnings call.

This has helped give investors confidence that Waymo is well-positioned to lead the commercial rollout of robotaxis in the US. The company was valued at $45B in its latest round, up from $30B.

Source: CB Insights — Alphabet’s Q3’24 earnings call

Compare robotaxi companies to identify potential partners

GenAI increases hopes of full autonomy breakthrough

Advancements in genAI are also acting as a tailwind in the autonomous driving space, with hopes that this technology can accelerate the timeline for full autonomous driving by removing remaining hurdles — such as cost, explainability, and vehicle-passenger communication.

Both Waymo and Wayve are investing heavily in the use of genAI to improve their existing autonomous driving systems.

Wayve specifically is developing a self-learning end-to-end AI driving system similar to Tesla’s that could be used by any automaker and is financially backed by some of the biggest AI players such as Microsoft and Nvidia.

Report: How generative AI is impacting autonomous driving

Self-driving stack developers target multiple autonomous driving use cases

The ability to target multiple autonomous driving use cases is another key strength of self-driving stack developers, allowing them to opportunistically pivot to focus on the most commercially promising ones. For example:

• Waymo reined in its investments in trucking use cases back in July 2023 to instead focus on robotaxis, where it saw more near-term commercial momentum. The company is now considering expanding into the personal car use case by licensing its technology.
• Wayve formed early partnerships with UK grocery retailers ASDA and Ocado, focused on home delivery of groceries. The company is now pushing deeper into robotaxis, partnering with Uber to roll out self-driving vehicles on the ride-hailing giant’s platform in the future.

Traction in the robotaxi space is driving other players to reconsider their AV strategy. For example, Elon Musk has increasingly framed Tesla as a robotaxi company — although the timing of the Tesla Cybercab launch remains uncertain.

Demonstrating a path to profitability will be key for robotaxi companies — including Waymo — to justify their outsized funding rounds, creating opportunities for OEMs and mobility players to help them scale or monetize their technology through licensing.

Their success also hinges on more municipalities and countries authorizing their operations, something that’s likely to take time unless regulations become less restrictive.

OEMs are keeping their loss-making self-driving units afloat with fresh capital injections

Despite mounting challenges such as safety issues and delayed commercialization, major OEMs such as General Motors (GM) and Hyundai have recalibrated their autonomous driving strategies while continuing to finance their subsidiary operations.

The sustained funding from OEMs amid setbacks reflects several strategic imperatives. For one, they’re still banking on the potential for returns on their significant existing investments, while also looking to position themselves competitively against tech-native OEMs such as Tesla and BYD.

Perhaps more importantly, it allows them to not miss out on the growth of the robotaxi industry by serving as suppliers of choice for vehicles and AV hardware — without bearing the full cost of software development. For example, Hyundai partnered with Waymo earlier this year to provide the robotaxi company with a fleet of vehicles equipped with autonomous tech.

Source: CB Insights — advanced search for corporate majority rounds in autonomous driving companies as of 11/13/2024.

GM provided its robotaxi unit Cruise an $850M lifeline despite safety incidents that forced the company to pause its service back in October 2023. The funding aims to bridge Cruise as it relaunches its service in select US cities, with the intent to charge for rides at the beginning of 2025.

Hyundai invested nearly $1B — including a $475M fresh capital injection — to gain 85% control of Motional, an autonomous driving JV between Hyundai and Aptiv. Aptiv’s stake reduction in the JV followed a strategic decision to cease further investment due to delayed commercialization.

Given the market pressures and challenges these units have faced, other OEMs may have an opportunity to gain exposure to the autonomous driving space by partnering with or investing in these units on favorable terms rather than trying to build the technology themselves. 

Ride-hailing players can partner with robotaxi companies to mitigate the impact to their business model

The ride-hailing industry is undergoing a major shift as platforms rush to integrate AVs into their networks.

While these partnerships offer compelling near-term advantages, they also highlight the existential challenges facing traditional ride-hail business models in an autonomous future.

Source: CB Insights — business relationship data for Uber and Lyft as of 11/13/2024

Leading platforms such as Uber and Lyft — which sold their autonomous driving units in 2020 and 2021, respectively — are pursuing multiple parallel relationships with autonomous driving developers, suggesting both urgency and hedging strategies.

Between the two, Uber is currently leading the way with 5 partnerships since 2023, 4 of which have been signed since August this year. In September, the company announced an expansion of its partnership with Waymo, giving access to Waymo’s robotaxi through the Uber app in Austin and Atlanta (starting in 2025) in addition to Phoenix, where Uber users have been able to order a Waymo since October 2023.

These partnerships offer immediate operational benefits: reduced driver costs, improved service reliability, and the ability to better manage surge pricing.

However, they also expose how the current ride-hailing platform model faces disruption — that is, by helping autonomous driving companies build direct relationships with consumers and gain real-world miles to improve their autonomous operations. This creates a paradox where ride-hail companies are essentially helping to incubate their potential future competitors.

Looking forward, ride-hail companies face 3 distinct strategic paths:

• Partnership strategy: betting on becoming the dominant platform layer atop multiple autonomous driving systems providers
• Acquisition strategy: buying autonomous driving capabilities to maintain control of the full stack
• Potential acquisition target: positioning themselves to be acquired by autonomous driving companies seeking customer relationships and operational expertise

The choice between these paths will likely determine which companies survive the transition to autonomous mobility. 

Report: How Uber is redefining its core businesses in the age of autonomy

In China, autonomous driving players have been pushed to go public at reduced valuations

China is also seeing heightened activity in the autonomous driving space this year, including growing adoption of robotaxis. Baidu‘s Apollo Go service, for instance, averaged 75K fully driverless rides per week in Q2’24, up 26% YoY.

Chinese autonomous driving companies are also leading an exit wave through public listings, with Horizon Robotics and WeRide going public in October and Pony.ai, Momenta, and Minieye all recently filing to do the same. But they’re doing so at a discount to their last private valuations, reflecting limited access to private capital at a time of accelerating commercialization. 

Source: CB Insights — advanced search for autonomous driving exits over time as of 11/13/2024 (excludes corporate majority deals)

Both Horizon Robotics and WeRide completed their IPOs at a more than 20% discount to their last private valuations, while Pony.ai is reportedly seeking a $4.6B IPO valuation, down from $8.6B just a year ago.

Private funding for China-based autonomous driving companies has dropped 90% since 2021, from $4B to less than $400M in 2024 YTD. The funding drought is pushing many of these companies to secure public funding or risk falling behind in the capital-intensive race to autonomy.

This funding crunch comes at a particularly critical time, as many players are accelerating their commercialization efforts and require capital to scale operations. As newly public companies face greater scrutiny over quarterly performance and profitability, they’re likely to prioritize near-term revenue generation over long-term technological development. 

For transportation and mobility companies looking to expand in China, this creates opportunities to partner on advantageous terms with local players that need to show commercial progress.

This shift will also create an opening for well-funded private players like Waymo, which can maintain their focus on achieving full autonomy without the pressures of public market expectations. 

Finally, the need for operational efficiency is likely to drive consolidation within the industry, as public companies seek cost synergies and combined market power to improve their financial metrics.

Identify likely autonomous driving acquisition targets

Looking ahead

Robotaxi adoption and genAI integration are already driving the next phase of the autonomous driving market’s evolution, pushing mobility players and OEMs to reassess their strategies after some had reduced their exposure to the space.

Although the success of robotaxi operations hinges on gaining regulatory approval in many more cities — which, in the US, may be accelerated under the incoming administration — expect to see a flurry of partnerships and strategic investments as automakers, autonomous driving hardware suppliers, and mobility platforms all vie to help robotaxi companies scale and get a share of the market.

As leaders such as Waymo race ahead, emerging autonomous driving companies will have to choose between accelerating the commercialization of their existing solutions or trying to outcompete winners on technological advancements (e.g., full driving autonomy, significantly cheaper autonomous driving systems, etc.).

Either strategy will likely require pooling resources, leading to consolidation in the space.

MORE AUTONOMOUS VEHICLE RESEARCH FROM CB INSIGHTS:

• Generative AI is accelerating the timeline for fully autonomous driving
• Autonomous driving systems market report
• Uber’s AV strategy: How the rideshare giant is redefining its core businesses in the age of autonomy
• Robotaxi market report

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By 2029, SDVs could account for as much as 90% of auto production, up from just 3% in 2021, per Morgan Stanley. However, the transition comes with steep challenges, such as the technical complexity involved and the need for strong cybersecurity measures to protect connected vehicles.

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Despite the declines, global regions like the US and Europe have made gains in median deal sizes this year, and both the US and EU continue to provide government grants and loans to climate tech solutions. China, on the other hand, has rolled back some of its clean energy subsidies, and VC enthusiasm has waned in the country this year.

Globally, governments are focusing more on early-stage technologies that are ready for commercialization. Two prime examples in the US are nuclear fusion energy and direct air capture of CO2, both of which have received substantial funding from the US Department of Energy this year.

Download the full report to access comprehensive data and charts on the evolving state of climate tech across sectors, geographies, and more.

Below, we cover key shifts in Q3’24.

• Climate tech funding falls to $4.8B in Q3’24, marking the lowest point since Q2’20. Venture capital has shifted away from the sector as high interest rates impact climate tech’s capital-intensive projects and as investors pivot toward AI, which tends to feature more rapid developments and shorter commercialization timelines.

• M&A activity drops dramatically in Q3’24, with only 43 deals completed — a more than 50% decline from the previous quarter. While notable exits like Kyte Powertech ($277M valuation) and SRE Power ($72M) suggest a steady appetite for grid infrastructure solutions, the overall slowdown signals a more selective M&A environment, potentially limiting exit opportunities for highly valued climate tech companies.

• US and European deal sizes show resilience despite the slowdown in global funding. In the US, the median deal size has reached $6M in 2024 YTD (up from $4.3M in 2023), while Europe’s median deal size has grown to $4.9M (up from $3.7M in 2023), indicating sustained investor confidence in these markets.

• Despite declines in overall climate tech funding, companies commercializing solutions in carbon capture, utilization, and storage (CCUS) continue to secure significant capital, as demonstrated by Twelve‘s $200M Series C round in September. Twelve is using the funding to finish building its Washington state facility, where it will produce sustainable aviation fuel (SAF) that it claims can deliver up to 90% emissions reduction compared to conventional jet fuel.

Source: CB Insights — Twelve Funding Insights

• Electric vehicle technology funding reaches a critical low of $0.6B in Q3’24, marking its lowest point since early 2020. However, the sector still attracted notable deals, including 24M Technologies‘ $87M Series H round at a $1.3B valuation, pointing to selective investor appetite for more mature EV tech companies.

More energy resources from CB insights:

• 5 climate tech markets gaining momentum in 2024
• The grid tech market map: The companies tackling the growing need for reliable electricity
• The energy impact of generative AI: 3 technologies transforming the future of data centers
• Analyzing 15 oil & gas leaders’ tech priorities: Here’s where incumbents are buying, investing, and partnering
• Sodium-ion batteries are poised for a breakout moment — energy players should prepare
• Why energy giants should have green ammonia on their radar

The post State of Climate Tech Q3’24 Report appeared first on CB Insights Research.

What you need to know:

• Autonomous vehicle (AV) systems providers are using genAI to boost in-car voice assistant capabilities, reduce training costs, and improve safety and transparency.

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While it sold its autonomous vehicle (AV) unit (ATG) in 2020, the now-profitable company is leveraging its 2.8B quarterly trips and global reach to attract AV partnerships that could reduce costs long-term across its rideshare, delivery, and freight business lines.

For transportation and logistics executives, Uber’s recent activity signals a shift in the mobility landscape, highlighting the importance of diverse AV partnerships to hedge against tech and regulatory uncertainties while capturing early market share.

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Essential resources to understand the future of automotive, supply chain, & aerospace tech:

• How AI is reshaping the auto industry — A look at 15 high-momentum technologies across the automotive value chain.

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However, semiconductor manufacturing is immensely complex, extending across a vast value chain from the production of ultra-high-purity raw materials to chip design, assembly, and testing.

This complexity, coupled with geopolitical tensions, has made semiconductor manufacturing a focal point for national security and economic policy. Governments and industry leaders are racing to build more resilient supply chains to support critical technologies like high-performance computing and defense systems.

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What you need to know:

• While the micromobility market has been tumultuous, continued demand from consumers is incentivizing players working to figure out a profitable solution. 
• The maintenance and charging of electric batteries have been a common pain point for various business models, but new solutions are emerging. 
• B2B players are entering the market to serve last-mile logistics and sustainability goals.
  

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Micromobility is not an easy business — just look at the plight of electric scooter pioneer Bird, a former VC darling. Demand is not the issue, making money is.

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These tech leaders are collaborating with energy incumbents and startups alike to tap into renewable energy sources and decarbonize their operations.

While these big tech players are competing in the energy space, they are also developing unique strategies:

• Amazon is working to decarbonize its transportation and fulfillment center operations, with a focus on hydrogen tech.
• Google is pioneering new models for clean energy procurement as it works to boost the sustainability of its data center network.
• Microsoft is focusing on renewable energy sources — like solar and fusion — and carbon capture technologies to meet the growing energy demands of its AI-driven operations.
• Nvidia is enhancing data center energy efficiency and investing in the development of a green and reliable power grid.

This report uses CB Insights datasets like investments, acquisitions, business relationships, company scouting reports, earnings transcripts, and more. Learn more about our data here.

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What you need to know:

• Companies like Joby Aviation, Archer Aviation, Lilium, and Volocopter are nearing eVTOL commercialization, with plans to launch air taxi services as soon as 2025, pending regulatory approvals.

• Regulatory hurdles, infrastructure requirements, and battery efficiency are key challenges that need to be addressed before eVTOLs can become a widespread mode of transportation.

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In 2024 so far, a16z has backed more than 20 AI startups working within disruptive categories. For example, this year, it has invested in several AI-driven copilots and agents designed to automate key workflows in big industries like healthcare and finance. It has also turned its attention to multimedia generation startups expediting the creation of a wide variety of content, from images to videos to audio.

While championing AI’s advancement, the firm also acknowledges associated risks — its founders are proponents of open-source models, arguing that their transparency and accessibility will help ensure that AI is developed in a secure and ethical way. So far this year, the two largest a16z-backed AI deals have gone to open-source large language model (LLM) developers xAI and Mistral AI.

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It’s estimated that robots and other smart machinery will make up as much as one-third of US military presence in the next 15 years, according to Mark Milley, a retired US Army General and former chairman of the Joint Chiefs of Staff.

Unmanned systems already dominate in some areas — like aerial drones — while significant development is underway in bringing autonomous tech to the ground, ocean surface, and underwater domains.

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Amid the funding decline, investors are favoring smaller mid- and late-stage deals. However, they are still willing to place early-stage bets where they see strong opportunities.

Based on our deep dive in the full report, here is the TL;DR on the state of climate tech:

• • Global climate tech funding declines by 20% QoQ to $4.9B in Q2’24 — the lowest quarterly total since Q2’20. While deal count rebounded QoQ to 397 in Q2, it still came in well below 2023’s quarterly totals.

• • Climate tech doesn’t see any unicorn births (private companies reaching $1B+ valuations) in Q2’24, marking climate tech’s second straight quarter without any new unicorns. This coincides with a decline in late-stage deal sizes — the median deal size at that stage is $38M in 2024 YTD, down 16% vs. full-year 2023.

• • Late-stage deal sizes decline, while early-stage sizes show strength. The median late-stage deal size is $38M in 2024 YTD — down 16% from full-year 2023. In contrast, median early-stage size is up 39% YTD, suggesting that investors are still willing to place bets where they see strong early-stage opportunities. Two of the largest early-stage deals in Q2’24 went to Cylib and Aether Fuels. Both companies intend to use the funding to scale and support commercialization initiatives — goals that are generally communicated by later-stage companies.

• • $100M+ mega-rounds continue to trend down in Q2’24. Climate tech mega-rounds dropped from 17 in Q1’24 to 9 in Q2’24. The majority of Q2’24’s mega-round recipients are focused on scaling operations and achieving full-scale commercialization. For example, one of the quarter’s largest deals ($375M Series G) went to battery materials developer Sila, which plans to use the funding to ramp up silicon anode production.

Source: CB Insights — Sila Funding Insights

• Climate tech funding drops yet again in Asia. Climate tech startups in the region raised a total of $0.4B in Q2’24, down 33% QoQ and 89% YoY. China suffered the sharpest funding decline (-90% QoQ) among highlighted countries in the region. India and Japan watched funding fall by 28% and 57% QoQ, respectively.

More energy resources from CB insights

• 5 climate tech markets gaining momentum in 2024
• The grid tech market map: The companies tackling the growing need for reliable electricity
• The energy impact of generative AI: 3 technologies transforming the future of data centers
• Analyzing 15 oil & gas leaders’ tech priorities: Here’s where incumbents are buying, investing, and partnering
• Sodium-ion batteries are poised for a breakout moment — energy players should prepare
• Why energy giants should have green ammonia on their radar

The post State of Climate Tech Q2’24 Report appeared first on CB Insights Research.

Enter sodium-ion batteries.

They’re cheap to build, temperature-resilient, and could soon shake up the global energy storage market — which is projected to grow to $77B within the next 10 years.

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Humans will still play a crucial role — but instead of assembling parts or operating machinery, they will maintain robots and keep them running.

In these future factories, robots coordinate in unison, completing work automatically — without breaks, every hour of the day — to get products out the door. 

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Major players like BP and Shell are aiming to become net-zero emissions energy businesses by 2050, with Shell targeting a 50% emissions reduction by 2030 compared to 2016 levels.

These ambitious goals are driven in part by shifting regulatory frameworks. The EU, for instance, plans to require oil & gas companies to buy carbon credits to compensate for offshore activities, while in the US, the Inflation Reduction Act has incentivized sustainable aviation fuel (SAF) production.

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While Nvidia initially developed its graphics processing units (GPUs) for gaming, these chips turned out to be ideal for powering AI tasks. Now, the company is focusing its efforts on providing the computing hardware — notably its A100 and H100 GPUs — and the software infrastructure required for developing generative AI applications.

Amid the generative AI rush, Nvidia has grown rapidly. In fact, it recently surpassed Microsoft and Apple to become the world’s most valuable company. To bolster its leadership position and keep ahead of AI computing competitors like AMD and Intel, Nvidia has forged relationships with companies across the AI landscape.

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Assisted driving technologies also remain a core interest. In addition, automotive leaders are exploring the potential of humanoid robots to automate automotive manufacturing processes.

Below, we use CB Insights data on automotive leaders’ investments, acquisitions, and partnerships as well as earnings calls to benchmark their activity so far this year.

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Automakers have pursued cleaner, connected, and autonomous vehicles via a mix of acquisitions, investments, and partnerships. However, their strategies have evolved over the past few years.

For instance, many automakers have adjusted their plans for electric vehicles (EVs) in response to market pressures. General Motors recently rolled back its EV production goal for North America in 2024.

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While most genAI initiatives are still in early stages of development, incumbents and startups are betting heavily on its potential.

ABB, for instance, has identified over 100 internal applications for the tech, from robotics to predictive maintenance. Retrocausal, which develops a computer vision-enabled AI copilot for the assembly line, estimates that genAI can reduce manual assembly time by a third.

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Salesforce CEO Marc Benioff called AI “the single most important moment in the history of the technology industry” in the company’s most recent earnings call. JPMorgan CEO Jamie Dimon said, in his April 2024 letter, “we are completely convinced the consequences [of AI] will be extraordinary.” 

Others are hyper-focused on AI’s potential to drive new efficiencies and product development. Big pharma companies are pushing ahead with AI-powered drug discovery collaborations, with the goal of accelerating drug development timelines. Payments giants, meanwhile, are leveraging AI to fight back against a wave of fraud.  

Much of the hype around recent advances has yet to translate to revenue. No AI-discovered drug has been approved yet for sale (though Insilico Medicine brought the first drug fully generated by AI into human trials in 2023), and Salesforce acknowledged its latest AI push would not have a material impact on its revenue this year. 

But the promise of future opportunities — and the perceived risk of inaction — is driving leaders to make moves now that could eventually reshape some of the world’s biggest industries. Our 70-slide report surveys the AI strategies of the following companies:

• Financial services & insurance: JPMorgan, Visa, Mastercard, UnitedHealth Group
• Enterprise tech: Oracle, Salesforce
• Pharma: Eli Lilly, Novo Nordisk, Johnson & Johnson
• Industrials: Toyota, Siemens

Using the CB Insights technology intelligence platform, we analyzed signals like investment & partnership activity, executive chatter in earnings transcripts, patents, and more to understand their efforts. Download the full report to see them all. 

Largest companies based on market cap (as of 4/15/2024). Our analysis excludes big tech, semiconductor developers, and state-owned companies.

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