Other Prime-funded startups include: Verdox, a carbon capture company; Treau, which has designed a low-carbon air conditioner; Sublime Systems, which is trying to de-carbonize cement; and Clean Crop Technologies, which aims to reduce food waste.
While Kearney and Nordan speak frequently about the “valley of death” facing early startups with unproven technologies, their next idea is to help startups survive another deadly phase -- when, later in their lives, companies need capital to build their first plants. This fund would raise much more money by using charitable dollars – willing to accept more risk – to lure private investors by making them eligible for higher potential returns.
The idea makes sense to Columbia’s Usher. “If you just rely on philanthropic dollars, there are not enough dollars out there,” he said. “You need to blend the two somehow.”
Of the first 10 startups backed by Prime, one has failed and seven have raised subsequent financing at higher valuations. “That’s an indication that there really are needles in the haystack,” Nordan said, among companies that are “a little bit too early and a little bit too risky for conventional investors.”
This article was provided by Bloomberg News.