London amongst top global innovation hubs driving forward climate tech growth

London amongst top global innovation hubs driving forward climate tech growth: MicrosoftTeams-image (11)

23 February 2023

 Global investment and start-up growth in climate tech remains resilient despite a challenging economic climate, according to latest figures from London & Partners and Dealroom. Over the past five years global venture capital investment into climate tech companies has increased by 83%, with a total of $171.1bn raised since 2018.   

Home to large numbers of climate tech companies, talent and specialist VC funds, leading international technology hubs such as London and San Francisco are playing a key role in driving forward the growth of the climate tech sector.  

Some notable cities recording significant growth in investment into climate tech include: 

  • London which experienced 672% growth (jumping from $220m in 2018 to $1.7 bn in 2022), 
  • Paris growing by 590% from $348m in 2018 to $2.4 bn in 2022,   
  • New York growing by 223% from $402m in 2018 to $1.3 bn in 2022, and  
  • San Francisco experiencing a 43% growth from $3.7 bn in 2018 to $5.3 bn in 2022.  

As a region, Europe has attracted a total of $44 bn in climate tech investment since 2018, reflecting a growth of over 485%. In fact, while overall VC funding into European tech experienced a decline in 2022, investment into European climate tech companies bucked the downward trend and grew by 11% from 2021 to 2022 (from $14.3bn to $15.8bn).  

In terms of the total amount raised across global tech cities over the past five years, San Francisco leads climate tech funding with a $17.2bn of investment since 2018, followed by London ($5.63 bn), New York ($4.4 bn) and Paris ($3.9 bn) respectively. 

Global investment into impact tech (defined as any organisation mapped to at least one UN sustainability goal) is also on the rise, growing by 81% over the last five years with a total of $227.9 bn invested worldwide. As a region, Europe has seen a 316% growth in this area from $5bn in 2018 to $20.8bn in 2022.   

London is a leading centre for investment into sustainability led start-ups and home to a thriving tech ecosystem which is leading innovation in tackling climate change. Three main reasons why London is a thriving destination for growth in climate tech include investment opportunities, access to talent as well as access to numerous growth programmes and initiatives.  

London is currently home to the second most climate start-ups (359 climate tech start-ups), behind the Bay Area (with 384 climate tech start-ups) and ahead of New York (with 145 climate tech start-ups). And in the last year London attracted $1.7 bn of investment into climate tech the second highest year on record after 2021 ($2 bn).  

VC Investors   

Due to its high concentration of dedicated climate tech VC funds, London provides companies with easy access to growth capital. In the past few years, there has been a surge of new climate tech funds opening in the UK capital. In October 2022, London based VC, Lightrock announced its climate impact fund had reached around $900m. 2150, a VC which backs entrepreneurs tackling climate change in the urban environment, recently announced its fund had hit the $312m mark. Sustainable Ventures, works with sustainable start-ups to scale through community, investment, innovation, and workspace.   

In 2022 the city saw 104 successful rounds into climate tech spanning various sub-sectors including finance, urban and waste. In 2022, top three rounds in climate tech included Newcleo ($326.6m), Octopus Energy ($225m) and Carbon Clean Solutions ($150m).  

Green Finance  

Green finance has an important role to play in incentivising consumers and businesses to make more sustainable investments. As one of the world’s leading financial service centres, London is home to many companies in this area. In fact, London recently ranked as the number one Green Financial Centre in the world, according to a report from Z/Yen – ahead of the likes of Amsterdam, New York and Singapore.  

Companies such as Zeti, a London-based FinTech platform sit at the intersection of fintech, mobility and sustainability, facilitating pay-per-mile financing for zero or ultra-low emissions vehicles. Clim8 is another example of a platform providing a simpler way of investing into a targeted portfolio of funds which are already making an impact in tackling climate change covering clean energy, clean technology, sustainable food, smart mobility and recycling. 

Urban Tech and Clean Energy 

London has set an ambitious target to become a net zero carbon city by 2030 – this includes creating change in the way people live and occupy space in cities. The UK capital is supporting the growth of urban tech and clean energy start-ups in this area.  

This includes Zenobe, a company which designs, finances, builds and operates innovative battery solutions capturing renewable, balancing its supply on the grid and transporting it to electric vehicles. Solivus, is another London-based company dedicated to reducing reliance on non-renewable energy sources, by making cost-efficient energy and storage more widely available.  

What’s more companies like Cities Forum works with cities, companies, and organisations around the world to address and solve their urban and sustainable development challenges more efficiently. Whereas, Sustainability Group (Future Plus) a sustainability management and ESG Reporting platform allows organisations to gain a detailed view of their sustainability in terms of historical performance and their future ambition.

Circular Economy and Waste  

Waste is also a significant challenge when it comes to tackling climate change – and London has set a target to become a zero waste city by 2050. Companies such as Olio and Backmarket amongst many others are challenging consumers to rethink how they dispose of refuse, and items that they no longer need. Olio is a platform that looks to empower local communities and business to reduce food waste, by connecting them to each other. Whereas Backmarket, is establishing itself as the go to platform for refurbished devices.  

Pru Ashby, Head of Sustainability at London & Partners said: “It is encouraging to see strong funding into climate tech and impact tech companies in London and across the world – especially given the challenging wider investment landscape. Leading global innovation hubs such as London, San Francisco and New York are constantly innovating in this area and can therefore expect to continue to attract the most global investment and talent for many years to come. London has set an ambitious target to become a net zero carbon city by 2030 and technology and sustainable businesses have an important role to play in helping us to achieve that goal.” 

Dan Saunders, Founder & CEO at Zeti said: "As the world moves towards a more sustainable future, the demand for the adoption of zero and ultra-low emission transport has surged in recent years. Zeti aims to disrupt traditional leasing of electric vehicles and unlock the potential of pay-per-mile technology to revolutionise the financing of transport.  It's clear that London is a city at the forefront of this transition in order to improve air quality for its citizens. When combined with the deep pool of finance and technology talent available, it is the obvious city to start a fintech company." 

Avrilia Diamanti, Senior Venture Associate at Sustainable Ventures said: “We believe businesses that are built sustainably are more resilient and inclusive in the long term, both addressing fuel and energy poverty and creating green jobs. London has considerable momentum of public and private support for climate solutions which makes it easier to set up a new sustainable business, access grant funding opportunities, as well as investor and consumer appetite for climate tech solutions.”  



Notes to editors  

All data included in the above story and tables below has been downloaded from the Dealroom.Co database by London & Partners, as of January 2023.  


Climate tech total VC funding over the past 5 years (2018-2022) – City Comparisons  




New York  

San Francisco 

























$5.3 bn 

$2.4 billion 


Climate tech total VC funding over the past 5 years (2018-2022)  – Regional Comparisons  

































Impact tech total VC funding over the past 5 years (2018-2022) 





New York 

San Francisco  




























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