Climate change has become a significant challenge for global economies, and many people and organisations are working to address its impact on their communities. According to Statista Research, a majority of the respondents from the Association of Southeast Asian Nations (ASEAN) stated that they consider climate change to either be an immediate threat or an issue that deserves monitoring.
The Philippines led the way, with 73.8% of their respondents seeing climate change as a serious and immediate threat to the well-being of their country. Laos was second with 56.8%, followed by Vietnam with 55.6%, and Indonesia with 52.7%. Singapore rounded out the top five, with 51.4% sharing a similar sentiment.
What is climate backsliding, and why should businesses in Southeast Asia care?
As such, a new trend of climate tech startups is emerging to address pollution, waste management, renewable energy, and reducing society’s carbon footprints. Governments and venture capital (VC) firms are supporting climate tech in Southeast Asia to innovate solutions for a sustainable future.
Greentech Accelerator Programme
In May, UOB The Finlab launched the Greentech Accelerator, a programme supporting innovative green technology solutions focused on energy efficiency, carbon management and reporting, and developing zero-waste supply chains. The three-month programme had funding of USD 108,500 (SGD 150,000) and aimed to use the money to solve real-world problems.
Furthermore, the accelerator aimed to provide mentorship and build the green ecosystem by creating strong partnerships, offering training, webinars, and masterclasses, and delivering valuable insights through educational ESG (Economy, Social, and Governance) programmes.
The Greentech Accelerator selected 12 startups for the programme, including Tava, HydroNeo, Alterpacks, CO2 Connect, Pantas, Resync, and Red Dot Analytics.
Startups making an impact in Southeast Asia
As the region increasingly becomes an innovation hub, these established climate tech startups are having an impact on Southeast Asia:
Singapore-based climate tech venture builder, Wavemaker Impact, builds sustainability-focused businesses in ASEAN. Last year, the company announced that it was targeting USD 25 million for its first fund. Bloomberg reports that Wavemaker has reached the first close of its debut fund, the Maiden Fund, landing USD 13 million from several investors.
In October 2022, the firm partnered with Breakthrough Energy Ventures, Temasek Holdings, and GenZero to set up an agricultural technology (agritech) startup focused on decarbonising rice cultivation. Wavemaker leaders state that the goal is to deliver these solutions to Southeast Asia and the rest of Asia.
A high-impact climate action firm, CarbonClick, provides the tools and resources to help businesses and individuals calculate, reduce, and offset their carbon footprints. It has been certified as a B-corporation—organisation that meets high standards of social and environmental impact. Every project meets UN sustainable development goals (SDGs), and people can easily track their carbon offsets.
Velocity Ventures, a VC firm in Southeast Asia’s Travel and Hospitality sector, invested an undisclosed amount in CarbonClick. The money will be used for expansion into ASEAN in Singapore next year since CarbonClick is in New Zealand.
The Filipino startup Humble Sustainability operates in the field of the circular economy —a framework whereby production and consumption are done sustainably. This approach means businesses and individuals reuse, refurbish, and recycle to reduce waste and pollution, protect nature, and keep items in use for as long as possible. The company helps companies with products they are struggling to sell by taking the things and giving them to B2B buyers, resellers, or thrifters.
Humble Sustainability raised USD 750,000 in a seed round led by Seedstars International Ventures. Other investors included iSeed Ventures, Alan Wong, co-founder of Jakarta-based B2B marketplace Ula, and Paco Sandejas. The money will aid expansion, product development, and recruitment.
Future of climate tech in ASEAN
Innovations in climate tech in Southeast Asia will continue as more people worldwide, and in ASEAN specifically, raise their environmental consciousness and participate in various eco-friendly initiatives. One way to play a part is by starting a company in the sector and meeting with stakeholders in the ecosystem to establish what solutions the market needs.
A second way to impact the environment is by investing in businesses in the sector. According to the Singapore Economic Development Board (EDB), investments are pouring into Southeast Asia to help climate tech startups innovate and find sustainable solutions. There have been many deals in the electric vehicle (EV) market as the region works towards transitioning to renewable energy.
EDB’s report predicts that environmental consciousness and demand will increase. More startups will begin using blockchain and Web3 technologies to provide new solutions in climate tech. Much focus is on carbon credits, and blockchain is known for keeping secure and verifiable records.
Finally, there should be greater collaboration in the ecosystem among shareholders, government officials, research institutions, and others to combat climate change. Without a unified approach, many loopholes could lead to increased environmental damage.