About episode
In this week’s episode, we’re focusing on the opportunity to invest in buildings, cities, infrastructure and air conditioning. Why? Well, for one thing, 40% of global greenhouse gas emissions come from the built environment and, according to the Climate Group, those emissions are set to double by 2050 if they’re left unchecked. Why else? Well because it’s been crazy hot this summer and the record heat waves we’ve experienced are unfortunately just the beginning.
And so I was thrilled to talk with Christian Hernandez Gallardo, Co-Founder and Partner of venture firm 2150 that’s investing in making cities more efficient, sustainable and resilient. And also Daniel Betts, Founder of Blue Frontier, a startup that is set to disrupt the air conditioning market in a very good way.
As investment in urban infrastructure begins to take off, a real transformation is possible and companies like Blue Frontier offer a glimpse of what the future can hold. I hope you enjoy this conversation as much as I did. Let’s dive in.
In today’s episode, we cover:
- [3:33] What is 2150 and the investment thesis that’s driving their work
- [4:37] Why focus on cities and city infrastructure AKA the built environment
- [7:03] Personal motivations behind investing in climate founders
- [10:36] Finding optimism through climate work
- [11:48] The importance of cooling
- [14:46] What is Blue Frontier and what problem is it aiming to solve
- [17:15] What climate impacts can Blue Frontier’s technology create
- [20:02] Replacing refrigerants in air conditioners with other materials
- [21:20] What will it take for Blue Frontier technology to reach scale
- [27:01] Commercial and municipal challenges in replacing legacy infrastructure
- [31:20] Where is there a lack of built environment innovation and investment
- [35:37] How to support the transition to more climate-positive built environments
- [40:25] Tips on how folks can start investing
- [41:29] Calls to action from 2150 and Blue Frontier
What is 2150 and the investment thesis that’s driving their wor
2150 is a European-based climate tech venture capital firm that was unveiled last year in 2021. The fund is a 270 million Euro investment vehicle focused on financing technologies that can help make the urban environment more efficient, resilient and sustainable. Not only do they focus on investing in buildings, but also on infrastructure, how things are built, what materials are used, how movement occurs in and out of cities, how to keep buildings warm or cold, and ultimately, how to keep people healthy, safe and secure. Christian argues it’s the world’s largest vertical fund team. Split between Copenhagen and London with investments from British Columbia and Canada all the way to Hong Kong, 2150 invests thematically across big problem sets on a global basis.
Why focus on cities and city infrastructure AKA the built environment
Christian came out of Princeton’s Executive Program at the Andlinger Center for the Environment with two simple, but significant realizations:
- There’s no single technology that solves our sustainability problem. Instead, many solutions need to be deployed at scale quickly.
- Literally nobody wanted to fund climate tech entrepreneurs four years ago.
From these discoveries, he uncovered an opportunity to do the job that he loves, which is backing amazing entrepreneurs, and to do so for technologies that can have an impact.
After the program, Christian spent about another year figuring out where to focus and found himself honing in on the built world. Cement and steel, how we heat and cool our buildings, and how we transport things around cities make up about 21% of greenhouse gas emissions. However, Christian says only about 4% of venture capital dollars in climate tech went into the built environment between 2013 and 2021. He explains that if you look at the International Energy Agency’s database of technologies and sort the list by maturity and impact, the top 10 technologies all end up being in the built environment. So he believes that we need technologies that can help us in 10 years time, but we also need deployment today. The built environment is that space where there’s market demand accelerating, where there’s technologies that are ready and available, and where there’s a need for more capital.
What is Blue Frontier and what problem is it aiming to solve
Blue Frontier is an air conditioning startup that was founded in late 2017. The company’s technology, driven by a salt solution, was originally developed at the U.S. Department of Energy’s National Renewable Energy Laboratory (NREL) and has proven to be many times more efficient than conventional air conditioning technology. The salt solution has a very high energy density, meaning that a lot of cooling can be created with a very small amount of the solution. The combination of the potential of storage, plus the capacity to have very high efficiency air conditioning, makes the technology well-positioned for cooling buildings, allowing people to be comfortable, and also mitigating some of the worst effects of climate change that are being created by air conditioning.
Blue Frontier is dedicated to the commercialization of this unique technology. The team has taken the technology from a science project to pre-commercial state, with a focus on on manufacturability, lowering cost, and also implementing different characteristics into the technology that would allow them to tackle the market in a disruptive way. The goal of Blue Frontier is to supplant the conventional vapor compression technology of the air conditioning market that exists today, essentially creating the LED equivalent for air conditioning.
Resources Mentioned
Connect with Christian Hernandez Gallardo and Daniel Bett
Connect With Jason Rissman
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