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New Zealand’s Startups

Can New Zealand grow a gigacorn?

Investors and founders discuss the challenges and opportunities present within the country’s cleantech sector.


Mary Hurley

With 54 billion tonnes (and rising) of CO₂ equivalent emissions produced around the world each year, Cogo founder Ben Gleisner has a goal. He wants his startup to be the world’s first gigacorn, let alone New Zealand’s first.

Playing on the startup term ‘unicorn’, a gigacorn is a commercially viable company that has achieved the milestone of lowering or sequestering CO₂ emissions by a gigatonne a year (for context, the equivalent weight of six million blue whales). 

Cogo’s method is straightforward: through a banking app, it provides individuals and businesses with carbon management products to measure, understand and reduce their emissions. Gleisner likens it to the AirBnB platform in how it connects people to (in its case, carbon-reduction) products. 

Having gone global, the Auckland-based startup is predicted to reach 100 million people by the end of 2024. With the average household producing 30 tonnes of carbon a year, Gleisner says this would see Cogo effectively managing three billion tonnes of emissions per year. 

Based on these numbers, Gleisner believes Cogo could be a “gigacorn baby” by the end of the decade. “If we can support people to reduce 10 tonnes of carbon a year, then 10 times 100 million is one billion tonnes of carbon,” he says.

Cogo founder Ben Gleisner

Gleisner is not alone in his hunt for gigacorn status. According to PwC research, the world needs to decarbonise at seven times the current rate to limit warming to 1.5°C above pre-industrial averages. Climate-tech, which is a subset of cleantech, has emerged as critical to achieve this. 

As a result, startups and investors alike are hunting gigacorns, with the latter largely leading the charge – and, despite the tight investment environment, they are putting their money where their mouth is. 

In 2023, Bloomberg reported venture funding for climatetech experienced an 89 percent year-on-year surge. Most of the US$70.1 billion investment, led by the US, China and Europe, was directed towards startups. 

Larry Fink, CEO of BlackRock, the world’s largest asset manager, predicts the next 1,000 unicorns will come from cleantech. (BlackRock recently made significant investments into New Zealand, including a $2 billion green energy investment, and plans to open an office).

With all that money and effort pouring into climate-tech worldwide, can New Zealand grow the world’s first gigacorn – or one at all?

Climate Venture Capital Fund partner Dr Jez Weston

Behind the curve

Although New Zealand has set a target of reaching net-zero emissions of long-lived gases by 2050, cleantech and climate-tech are relatively nascent sectors. Consequently, the terms are often conflated.

Climate-tech refers directly to emissions-reducing technology, while cleantech is wider, referring to any product, process or service that produces positive environmental impacts such as energy efficiency or sustainable water use.

For those chasing gigacorn status, the sector's youth is a major obstacle. Though still lagging behind many similar-sized economies, green momentum in New Zealand has increased in recent years with both government and investor initiatives cropping up.

The Climate Venture Capital Fund (CVCF), managed by 2040 Ventures, is one such enterprise. 

Launched in 2022, CVCF is the first private specialist climate fund based in Australasia and has a twin mandate of VC-level financial returns and maximum emissions reductions. 

It is the first VC fund in New Zealand to disclose emissions from the companies it invests in and to include its investments’ overall systematic impact.

The fund, whose portfolio companies include NovoLabs, Liquium, Hot Lime Labs, Zincovery, Cleanery and Australian-based MGA Thermal, aims to reduce one million tonnes of CO₂ per $50 million it has invested. It says it is well on the way to doing so. 

Fund partner Dr Jez Weston says New Zealand is “behind the curve” in decarbonisation technology due to a “historical blindness” to cleantech. 

Instead, the nation’s economy has been characterised by a sectoral focus, with industries such as agriculture, tourism and property more prominent than in other economies. 

“In the rest of the world, there’s been more emphasis on climate solutions and technology for climate solutions,” he says. 

Jason Patrick, New Zealand Green Investment Finance

The sectoral focus means that when we speak about decarbonisation, certain technologies today are mature while others are not, says Jason Patrick, chief investment officer at New Zealand Green Investment Finance – a Crown-owned bank established in 2019 to accelerate emissions-reducing investments in New Zealand. 

Patrick says this has left an uneven playing field for new businesses chasing capital, particularly in areas with “so-called industry incumbents”. 

Pam Walklin, head of commercialisation at Ara Ake, a government-funded entity also set up in 2019 to develop clean energy technologies for New Zealand, has had similar experiences. 

Walklin describes the regulatory conditions for the electricity sector as having been “developed in a different time.” Consequently, the current landscape “doesn't always enable innovation.” 

However, she notes there is no shortage of IP produced within the country.

Patrick agrees: “Is it possible for such a gigacorn to come out of New Zealand? Of course, why not?”

Ara Ake's Pam Walklin

At what cost? 

It is perhaps unsurprising that access to capital is one of the largest barriers faced by aspiring Antipodean gigacorns. 

In 2021, Callaghan Innovation released the New Zealand Climate-Tech for the World report which found, on average, Kiwi innovators in this space had raised 95 percent less private investment than those in comparable small advanced economies. 

While the report notes some of the gap can be explained by New Zealand’s agricultural bent, even countries with similar sectoral interests were found to widely outpace New Zealand.

Weston believes that improving funding for climate technology is crucial for New Zealand to foster a gigacorn. He says that at present either the funds are simply not there or, when available, are not being effectively directed towards decarbonisation and climate efforts.

“There’s a lot more to be done here,” he says. 

Phil Anderson, Callaghan Innovation

Though wary of the funding challenges, Phil Anderson, Callaghan Innovation’s cleantech lead, is optimistic given rising investment levels. 

In the previous five or six years, an average of about US $40 million in venture capital was invested annually into New Zealand’s cleantech space. In 2023, that number jumped to US $240 million in the first three quarters of the year alone despite the tight capital environment. 

Callaghan’s data also shows the number of cleantech businesses in New Zealand nearly doubled to 86 over the six years leading to 2021.

Cleantech investment, graph courtesy of Callaghan Innovation

Expanding horizons

Weston sees pockets of potential gigacorn excellence within New Zealand’s burgeoning cleantech sector.

“That’s kind of always the story with New Zealand innovation; there are a few niche things that we turn out to be really good at, often for not much in the way of good reason,” he says. 

As an investor, he says he is particularly interested in the startups providing unexpected solutions to “stuck problems”. 

“We talk with a lot of mature and high-emissions industries, and they’re all very aware that they need to clean up their acts, but they’re often not seeing any good solutions to their problems,” he says. 

Zinc, which has a higher CO₂ footprint when it is recycled than mined, is a good example, he says. 

At present, the best technology is a 100-year-old process powered by coal, and plenty of attempts at new processes have been unsuccessful, he says. The global annual market opportunity for technology in this sector is estimated at more US$10 billion and growing.

Weston says this is ideal ground for a startup like Christchurch-based Zincovery, which has developed technology that requires 70 percent less energy demand and lower production costs than its main competitors. 

Zincovery raised $3 million in 2022 in an early-stage venture capital funding round. Investors included New Zealand funds like Icehouse Ventures, K1W1 and CVCF, as well as Austrian billionaire Wolfgang Leitner.

In April 2024, it is planning an US$8 million capital raise to scale up a pre-commercial plant in Australia.

Ara Ake's Daniela McKenzie

Given the lack of investment in this space within New Zealand, going international for larger amounts of capital is a must for most founders, says Daniela McKenzie, Ara Ake’s head of global partnerships. 

The Kiwi cleantech sector needs to focus on improving global connectivity, as beyond capital, offshore investors also provide larger networks and access to skills, she says.

Anderson agrees. He says founders need to look internationally where the big polluters are, where the market is and where they will find true business sustainability – not only economically but also in terms of emissions reduction. 

He says the challenge now is getting investors and the government to look beyond meeting New Zealand’s emissions reduction targets and seeing where Kiwi IP can make it on the global stage. 

“If we stay too focused on New Zealand, we're not going to make a big difference to this global problem.” 

Is less more?

While Weston believes New Zealand is capable of growing a gigacorn, he worries that the term itself may distract founders and investors from the bigger issue: decarbonising at all levels. 

Using agriculture as an example, he says that what works for a dairy farmer in New Zealand will not necessarily be a solution for a soy farmer in Brazil. Instead, some problems require specific solutions. 

“Maybe in New Zealand, we’d be better off not aiming for a gigacorn but for 10 companies that can save 100 million tonnes per year, or 100 companies that can save 10 million tonnes per year,” he says. 

Weston sees Cleanery, a CVCF portfolio company, as an example of a startup in a smaller sector making the necessary changes. 

Cleanery, which founder Mark Sorenson says is “as old as Covid”, sits in the personal-care sector, using sachets of powdered cleaning products to remove unnecessary water and plastic. 

Last year, the startup closed an oversubscribed $2.34 million seed round, led by CVCF. 

The capital supported a launch into Australia and the startup is already in the midst of another funding round to help expand into the US. 

Though Sorenson says it is too early to report the total emissions Cleanery has saved, the startup estimates its products reduce plastic by 99 percent compared with traditional personal-care products – and its engagement with emissions reduction doesn’t end there. 

Sorenson says the startup tracks its emissions with independent verification, and purchases 120 percent offsets from Gold Standard for the Global Goals – a standard emphasising projects with maximum climate and development benefits.

Cleanery's Mark Sorenson

Cleanery has essentially solved the emissions problem for that sector, says Weston. 

Given New Zealand only produces 78.8 million tonnes of emissions a year, Weston and even the gigacorn-hunting Gleisner say New Zealand doesn’t necessarily need a gigacorn.

Instead, Gleisner says to have an impact on global emissions, “we’re going to need millions of other small companies to help along the way”. 


Mary Hurley

Mary Hurley brings three years experience in the online media industry to the Caffeine team. Having previously specialised in environmental and science communications, she looks forward to connecting with founders and exploring the startup scene in Aotearoa New Zealand.

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