The Ad Hoc Gist: It’s Getting Hot In Here
As I write this note, half the country faces a record-setting heat wave while wildfires burn north of Los Angeles. This month, I interviewed Katie MacDonald, the cofounder of Tailwind, on how to get more investors to back resilience tech.
Relatedly, my partner Julia Hamm wrote a piece in Latitude Media on how wildfires are threatening the viability of utilities and the energy transition. And, call me Cassandra, but three years ago I rang the alarm bell that climate resilience was getting short shrift.
In Ad Hoc news, we promoted three veteran Ad Hocers, Ian Rinehart, Annie Gilleo, and Max Tuttman to Vice President. And we’re hiring two Senior Associates (one focused on hard tech) to join our awesome team so spread the word.
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- Jim Kapsis, CEO
The Ad Hoc Group
It's Getting Hot In Here
![unnamed unnamed](https://www.theadhocgroup.com/wp-content/uploads/2024/06/unnamed.jpg)
What is Tailwind and why did you leave a career focused on climate mitigation to focus on climate adaptation?
Katie MacDonald: Tailwind is focused on accelerating the development and deployment of adaptation and resilient solutions. We define those as solutions that can predict, prevent, mitigate, and enable recovery from climate hazards like floods, storms and extreme heat.
I’ve been working on climate mitigation since I was 16, so a very long time. I started off getting arrested in college – you’re going to laugh – pushing for a bill mandating 100% renewable electricity in MA by 2009. I’ve worked for Greentown Labs, Cleantech Open, and NYSERDA, all focused on climate mitigation.
After the 2012 British Columbia heat wave where 619 people died, I had an epiphany. We are so under-prepared for the impacts of climate change. If we don't figure this out, we won't have the structural integrity to continue our greenhouse gas reduction work. This led me to cofound Tailwind with Emilie Mazzacurati.
Tailwind just released a report targeted at investors outlining key themes and sectors critical to adaptation and resilience. What are you hoping to achieve with it?
KM: We kept getting the same questions from entrepreneurs and investors, “If I want to invest in resilience, what does that even mean? Where across the economy and society is innovation even needed?”
So we developed an adaptation and resilience Investor taxonomy to help investors find new investment opportunities, identify existing portfolio companies achieving resilience outcomes, and help entrepreneurs determine where they can make an impact.
Are some venture capital firms already focused on resilience as a category?
KM: We randomly sampled 60 different climate tech venture firms out of 180 and we mapped their portfolios against our 35 sector taxonomy. And only two of those 60 firms – Autodesk Foundation and ADB Ventures – had the words “resilience” on their websites but the vast majority had at least one company in their portfolio we judged to be achieving some resilience benefit. And none of those 60 are out in the media talking about climate resilience! So while they’re investing in both greenhouse gas reduction and resilience, they’re only talking about climate mitigation. This must change!
When you think about the investment needed to enable the adoption of climate adaptation tech, what role do you see venture capital playing?
KM: We see lots of opportunities for venture. Some of my favorite climate adaptation tech solutions are Metalmark, which is developing an HVAC filter that can filter smaller than 2.5 pm wildfire smoke for HVAC systems to protect air quality. Rhizome (an AHG client) is helping utilities identify vulnerabilities from climate threats. Cryogenx is a cooling vest that can save someone from dying of heat stroke. ISeeChange crowdsources community data about the needs of the public to inform local governments.
But we know catalytic and patient capital will be needed, especially for those selling to governments, bridging to future private investment rounds, etc. To meet the moment on climate resilience we need more flexible capital – think grants and early stage investments.
What role do you think policy and regulation should play and at what level? Are there any governments leading by example others should follow?
KM: At a global level, there are 70 different governments that have national adaptation plans. Collectively, that’s billions of dollars available for government procurement. While the White House did release a National Climate Resilience Framework in 2023, we remain one of the only developed countries that does not have a national adaptation plan. The US Department of Energy doesn't have a clear definition for adaptation and resilience innovation it's able to share.
Anything you're seeing at the state or local level worth noting?
KM: Yeah, so there are five states with extreme heat standards -- Oregon, California, Colorado, Washington and Minnesota. (Yes, Minnesota!). Those states are providing learning laboratories for innovators helping private sector companies comply with those new laws. For example, you can imagine employers using new tech to monitor biometric data, cool people down, and survey the health of their workforces.
Is there one area you’re excited about where you see huge near-term potential?
KM: I’ll stay on the heat topic since extreme heat is the number one natural hazard in the US. Innovation can support the ability for both indoor and outdoor workforces. This is a huge opportunity for innovators and capital providers where there’s already an existing customer base and an immediate opportunity to save lives. We expect to see OSHA release standards in 2025 for extreme heat, which will drive both awareness and innovation as all companies will need to meet new regulations to keep employees safe.
In 5 years, what do you hope is different about how the market is responding to our resilience needs? How will you measure success?
KM: We don’t have a single net-zero-equivalent target metric when it comes to adaptation and resilience and we never will! But we need to quantify what resilience success looks like so we know what direction to row in and how fast. I hope in 5 years, we can say Tailwind was part of a successful coalition of partners who built out the Project Drawdown equivalent for climate resilience and adaptation and used it to turbo-load investment and innovation.
This interview has been edited and condensed for clarity.
News from Our Network
From our clients:
- Charm Industrial was featured in a New Yorker story that gives a behind-the-scenes look at what it takes to put carbon underground.
- Stripe is accepting applications for Climate Fellows until July 15th.
- Octopus Energy raised a new round with investment from Galvanize and Lighthouse Partners.
- T&D World’s Line Life podcast interviewed Gridware’s Tim Barat about his transition from Australian Lineworker to CEO.
- Rondo’s thermal batteries power Eastman’s molecular recycling facility, which is funded by a $375 million DOE grant.
- Pano AI’s CEO Sonia Kastner writes about Portland General’s wildfire mitigation success story.
Marcela Mulholland of the Carbon Removal Alliance was named to GreenBiz Thirty Under 30.
From friends and colleagues:
- Singularity signed a deal with Southern Company that will accelerate their grid carbon reporting.
- The Verge gave kudos to Quilt for its good looking and smart heat pumps.
- Akaysha Energy says the delay in Australia’s coal closures is hurting the country’s transition to clean energy.
- Rhizome is highlighted for its ability to predict power outages so utilities are better prepared.
- ConnectDER appointed Ivo Steklac as the new CEO and President.
- Urbint acquired WRM Software to expand into storm response and help utilities minimize power outages.
Jobs in our network:Â
Send us your job openings in cleantech policy, startups, and utilities, and we'll put them in next month's Gist.
Alliance for Transportation Electrification: Director of Policy and Regulatory Affairs and Director of Communications and Member Engagement
Elephant Energy: Head of Marketing
GridX: Group Product Manager
Technosylva: Customer Success Manager
truCurrent: Policy and Incentives Manager
Pano AI: Sales & Business Development Intern
Rhizome: Business Development Manager and Customer Success Lead
Uplight: Head of International Market Development and Regulatory Innovation
VEIR: Director of Business Development, Utilities
NARUC: Technical Specialist
PG&E: Incident Investigator, Principal
Find us:
EEI
June 18-20, Las Vegas
James Schulte, Julia Hamm, Ian Rinehart and Tess O’Donnell attending
MACRUC
June 23-26, 2024, Louisville, KY
Anjana Agarwal attending
Breakthrough Energy Summit
June 25-27, 202, London
Jim Kapsis and Max Tuttman attending.
Reuters Global Energy Transition 2024
June 25-27, 2024, New York, NY
Stephen Mushegan and Elta Koliou attending.