Scott Dylan, Co-founder of Inc & Co and Founder of NexaTech Ventures and prominent advocate for climate innovation, has endorsed Barclays Bank’s call for the UK government to address a £1.5 billion funding gap in the climate tech sector. Barclays recently issued a report warning that without adequate financial support, many high-potential climate tech companies could struggle to scale, jeopardising the UK’s net-zero ambitions.
“Barclays’ findings are both timely and critical,” said Scott Dylan. “We’re at a pivotal moment for climate technology in the UK, and the lack of Series B+ funding is a serious obstacle. The UK is home to some of the most innovative green technologies, but without the necessary capital to scale, we risk falling behind in the race to net zero.”
Barclays’ report points to a significant shortfall in venture-backed Series B+/growth-stage financing, with investment in European climate tech companies falling by 48% in the first half of 2023 alone. The bank has urged the government to establish a dedicated climate tech fund, focusing on debt and equity transactions for firms requiring between £10 million and £25 million.
Dylan, who has long been a proponent of public and private sector collaboration in tackling climate change, echoed these sentiments. He believes the government needs to take a more active role in closing the funding gap, particularly through public finance institutions like the UK Infrastructure Bank (UKIB) and the British Business Bank (BBB).
“Climate tech companies face a unique set of challenges—high capital costs, long paths to profitability, and an inherent risk profile that can deter traditional investors,” said Dylan. “This is where the government, through the UKIB and BBB, must step up with targeted support. These institutions are crucial, but they need to be better resourced and aligned to meet the needs of climate tech firms.”
Barclays’ report highlights the urgency of addressing the funding gap, noting that the UK’s ability to meet its 2050 net-zero target depends heavily on the successful scaling of green technologies. According to the International Energy Agency, the technologies being developed by climate tech companies today could reduce global greenhouse gas emissions by 35% by mid-century.
Scott Dylan emphasised that failing to address the funding shortfall now could have long-term consequences for the UK’s green transition. “We have the talent, the technology, and the entrepreneurial spirit to lead the world in climate tech,” he said. “But without the right financial infrastructure in place, we could be squandering that potential. The time to act is now.”
