The first Climate Tech Summit Aotearoa was held at St James Theatre on June 20
The first Climate Tech Summit Aotearoa was held at St James Theatre on June 20

OPINIONBusinessJune 24, 2024

Windbag: Wellington thinks it has found its next superstar industry – climate tech

The first Climate Tech Summit Aotearoa was held at St James Theatre on June 20
The first Climate Tech Summit Aotearoa was held at St James Theatre on June 20

At a flashy conference at St James Theatre, the capital pitched itself as a future global hub for hi-tech climate action.

“This is where the future of jobs is going to come from,” said Rebekah Campbell, the tech lead for WellingtonNZ, the council-controlled agency responsible for economic development in the region. She was standing on the sleek black stage of the St James Theatre, surrounded by green and blue lights. In the crowd were 500 founders, scientists and investors, all gathered for the first-ever Climate Tech Summit Aotearoa.

The summit last Thursday was the public launch of WellingtonNZ’s new campaign to push climate tech as the capital’s industry of the future. Climate tech, also called cleantech, is a relativity broad category, defined as any tech-based solutions to environmental problems. Campbell talked a big game. She is aiming for 30,000 tech jobs in Wellington in 10 years and, eventually, multiple billion-dollar companies.

The three-hour event was slick and authentically techy. Presenters wore Allbirds with chinos, and white New Balances with tucked-in jeans. The intro music was always slightly too cool for the speaker, but in an endearing way. A moderator asked a panellist to elaborate by saying, “Let’s double-click on that.” On more than one occasion, people referred to their own speeches as “content”. It had elements of a political rally, a shareholder summit, and an episode of Shark Tank. There were stirring ra-ra speeches about the scale of the climate crisis, but no one was pretending to be an altruist. They were there for the money. The climate crisis is the biggest problem humanity has ever faced, and the solutions could be immensely lucrative.

More than anything, it was a showcase. It was New Zealand’s climate tech industry announcing itself to the country and the world, and Wellington trying to position itself as the industry’s natural base. The success stories were rolled first, with founders giving five-minute presentations about their companies. Some of the Wellington-based startups included: Bspkl, which manufactures high-performance membranes that make green hydrogen cheaper to manufacture, OpenStar, which is trying to develop the first nuclear fusion reactor that generates more energy than it consumes, and Hot Lime Labs, which creates clean CO2 for commercial greenhouses. Three new startups from Creative HQ’s climate accelerator won a $50,000 investment each from Motion Capital: Good Grub Agritech, which produces low-cost insect protein for animal feed; Mara Bio, which makes a fungi-based protein; and Aotea Energy, which is developing smart home batteries.

OpenStar’s Ratu Mataira (Photo: Supplied)

Most of these companies will never be household names. They’re working on niche problems in highly complex areas. But it’s not hard to see the enormous commercial opportunities. New Zealand-founded LanzaTech, which turns industrial carbon emissions into usable fuel and chemicals, raised $250 million pre-revenue and reached a peak valuation of $2.2 billion (though its current stock price is considerably down from that high).

When I’ve spoken with investors, business lobbies or political leaders about the state of the Wellington economy, there’s one word that always comes up: diversification, or lack thereof. Wellington is propped up by the government as the largest employer, providing tens of thousands of highly skilled, well-paying jobs. Being reliant on one industry is risky – there are small towns all over New Zealand that were all but abandoned after the gold ran out or the meat works shut down. The public service is safer than those industries, but it’s not immune to ups and downs. We can see that right now with public service cuts knocking the city economy.

There are four homegrown businesses worth at least $1 billion with large workforces in Wellington: Datacom (founded in 1965), Weta (1987), Trade Me (1999), and Xero (2006). The council’s economic development leaders often say the city needs three to four more startups to reach the level of those four companies before it will truly be a thriving tech hub. Once an industry grows to a certain level in a city, it becomes self-seeding. The skills base gets larger, people start their own firms, which create even more jobs and attract more money.

Campbell said there were three reasons climate tech stood out as the city’s most promising growth industry: Wellington has the largest concentration of scientists in the country, there’s already an emerging cluster of climate tech businesses, and there’s a value alignment with Wellington. That last point is much harder to quantify than the others, but it feels right. Wellington’s general vibe seems to suit climate tech people – ambitious in a nerdy way, principled and environmentalist.

But what can WellingtonNZ actually do about it? The agency doesn’t have enough money to invest in startups directly, and the council can’t offer any juicy tax breaks or subsidies. The top concern you hear from almost every tech founder in Wellington and across New Zealand is access to capital. There aren’t enough investors, and founders struggle to reach the ones that are out there. That’s something WellingtonNZ is actually proving itself to be quite good at. Hosting summits and conferences, investor events, taking founders on international junkets is all just soft promotion. It’s pretty cheap in the scheme of things, but it can go a long way to support a fledgling industry.

There is a scattergun approach. Not all of these companies will succeed. Most won’t. “We only need a couple to hit,” Joe Slater, Creative HQ’s head of startups, said after the event. But all it takes is a couple more Xeros, and Wellington would look like a very different city.

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