Women are leading a transformation in the climate fintech sector, blending sustainability with technological advancement. According to Tenity’s 2024 Global Climate Fintech Report, firms with at least one female founder or CEO secured over half of pre-Series B funding from 2022 to 2023, a sharp contrast to the broader fintech industry, where women-led firms capture just 3.4% of venture capital.
Notably, women co-founded or led a third of climate fintechs, with that figure rising to 45% in 2023. Despite these milestones, they face a “triple glass ceiling” comprising leadership challenges, tech industry biases, and complexities in the evolving climate fintech space. Research from the University of Manchester and National University of Singapore highlights the persistent sexist culture these professionals navigate.
Andreas Iten, CEO of Tenity, underscores the significance of these shifts, pointing to an increased proportion of female-founded startups in 2023 despite fewer overall launches. This progress marks a critical step toward gender parity in the sector.
What is Climate Fintech?
Climate fintech applies financial technology to combat climate change and drive the transition to a low-carbon economy. Tools for ESG reporting, green investing, and carbon tracking play a central role as industries prioritize sustainability and compliance with new climate-related regulations.
These solutions are becoming indispensable, especially as global financial markets respond to increasing pressure for transparency in sustainability-related risks and reporting.
Key Insights from Tenity’s Report
Tenity’s analysis of 750 startups reveals a unique trajectory for climate fintech funding. While global venture funding fell by 38%, Europe experienced a slight decline of just 2.2%. The UK, Germany, and France dominate the European landscape, accounting for 65% of EMEA’s venture capital and half of its climate fintech startups. Europe’s advanced climate legislation, including the CSRD and SFDR, has fueled demand for ESG data solutions, with 90% of regulatory reporting tools originating in this region.
However, functional maturity in Europe’s climate fintech sector lags behind the US. Only 17 European companies have raised over $50 million, compared to 23 in the US. Despite this, the sector remains at the forefront of diversity and innovation. Technologies like blockchain for carbon market accountability and AI for real-time climate risk assessments exemplify its pioneering spirit.
“Climate fintech is setting new standards for inclusion and resilience,” notes Andrea Fritschi, Tenity’s Chief Investment Officer. With Europe leading in diversity and innovation, the challenge lies in scaling these advancements to match the US’s global reach.
