Barclays Climate Ventures has highlighted the challenge of the “missing middle” financing gap for investment in climate technology companies.
The portfolio’s impact report revealed that it had enabled £508m of investment in climate tech firms since 2020.
But it also said the initial upfront costs and long timeframes to profitability and scale had much it challenging for traditional venture capitalists and infrastructure funds to invest in such businesses.
As a result, there was a “missing middle” financing gap, which it aimed to address through investment to the tune of £203m in early and growth stage climate tech since 2020 across the globe.
Using data calculated by the Carbon Trust, the report also quantified the broader impact of Barclays Climate Ventures’ investments, such as the 1,309 jobs created by the portfolio companies, including 664 across the UK alone.
It has led or co-led more than half (61%) of the transactions, and enabled a further £305m of third-party investment – equivalent to £2.18 for every £1 from Barclays in these rounds.
In addition, it said that climate technology was “key to delivering the next generation energy system”, addressing the climate challenge while “supporting a successful and growing economy with affordable and resilient energy”.
Steven Poulter, Head of Barclays Climate Ventures, said:
“The UK is home to a thriving climate tech ecosystem, but to unlock the sector’s economic potential, we must find ways to address the financing gap that holds back their growth.
“Today’s report shows that, through a willingness to adjust our risk appetite and take a new approach, we have been successful in catalysing investment into climate tech – capable of delivering UK economic growth, energy security and emissions reductions at scale. We now call for more investors to join us on this journey.”
