Climate X

The impacts of climate change are everywhere, giving rise to new risks and accelerating the need to adapt our physical infrastructure and societies. Regulators are introducing new regulations to disclose those risks to protect the financial system. Investors are adjusting portfolios and adopting new products to accelerate infrastructure adaptation to manage risk and returns. Governments are planning large-scale investments into new infrastructure to prepare for an uncertain future. People are wondering if they are safe and secure where they live and work.

Better data, and inference of those changes, are a key lever in being able to minimize those risks and accelerate the transition to a climate-compatible future. This is easier said than done. Waves of new data are coming online as the cost of sensor and data collection declines, and a flood of new techniques for analysis and inference makes it harder than ever to keep up.

This is where Climate X comes in. Climate X is building a unified data ingestion and inference platform from the ground up to enable dynamic, detailed scenarios of asset-based physical and economic impacts from climate change. They call it a digital twin of the earth. By automating data ingestion, modularly applying inference algorithms, and exposing an API for accessing the latest in climate data and intelligence they aim to build a foundational climate intelligence resource that is clear, transparent, and continuously improving to empower better decisions.

For asset owners, it means more granular insights into portfolio risks based on the changing climate and potential scenarios of action. For investment managers, it means insights into new products and investment opportunities. For governments and companies, it means earlier identification of climate-related vulnerabilities and better informed, long-term investment decisions. And for everyone else, it means a faster path toward a climate-compatible society.

Harnessing climate intelligence to accelerate decarbonization and adaptation is an integral part of our Transition Economy narrative. Our research initiatives into the use of scenarios for systemic finance, or the effects of inter-systemic cascades all pointed us to the challenge of understanding and navigating the complex, systemic risks that are rippling across society. And so, today, we are excited to announce our investment in Climate X alongside Pale Blue Dot, a100x, Blue Wire, New Chic, and a global group of strategic angels.

Lukky, Kamil and their growing team have come to this with first-hand experience modelling and managing risk across asset portfolios, partnering with leading experts in climate science and artificial intelligence to arrive at this new approach.

If you are looking for better data on asset-level climate impacts, reach out to learn more about how Climate X can help.

New Capabilities, Behaviours, and Systems: How ventures change the world.

A few weeks ago I started sharing how we think about the transformative potential of ventures, or in other words, what’s the potential for a company to ‘change the world’.

While it’s impossible to predict if any venture will actually ‘change the world’, we can be sure that if it does, it will have done so through some combination of the following:

  • introducing meaningful new capabilities;
  • sparking a change in behaviour;
  • enabling new systems of people, things, and information.

Let’s take a look at Twitter as a simple example.

  1. Allow people to post a simple text message that is publicly available (new capability)
  2. People start publicly sharing seemingly trivial updates such as ‘what they ate for breakfast’ (new behaviour)
  3. Allow anyone to subscribe to someone’s posts without their permission ( completes the loop to enable a new system)
  4. … effort, investment, and good fortune …
  5. The world’s information source for what’s happening right now.

Step 4 is what makes it happen, but steps 1, 2, and 3 set the stage for what’s possible. While few had any reasonable belief that step 5 would be the outcome when it started, it would have been easy to see from the earliest days that a new capability (1) was leading to a new behaviour (2) and giving rise to a new system (3). The behaviour of ‘sharing what you eat for breakfast’ was easy to dismiss, but enough of those that experienced it, sensed it could be something more.

Now, let’s see what how those components show up in early-stage ventures (click on the links for deeper dives):

Sparking a change in behaviour:

Jow lets people shop for groceries by browsing and choosing recipes instead of ingredients. Could this lead to more people cooking more meals at home?

Introducing a meaningful new capability:

Hopin introduces online technologies into offline event formats to enable new types of events. Could this lead to a more connected and engaged population?

Enabling new systems of people, things, and information:

Produce Pay combines real-time market intelligence, easy to access financing, and trading to enable a new high-trust produce supply-chain. Could this lead to a more sustainable and resilient produce industry?

Of course, like with Twitter, there is also often a combination of capabilities, behaviour, and system that make the change possible.

MeetFrank encourages people to explore new job opportunities, anonymously (capability), before they are looking for work (behaviour). They aim to leverage that into a talent-driven marketplace (system). Could this lead to a democratization of the job market?

In each of these cases it’s impossible to predict the outcome. We can however see that they each have some key components around which a world changing company could be built. And if your goal is to see a better future, those are great places to dig in to understand what might be possible.

You can see our growing set of perspectives here.