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21 July 2022

How innovative cleantech start-ups can secure funding from impact investors

How innovative cleantech start-ups can secure funding from impact investors

Mitigating climate change and achieving the climate goals of 2030 are some of the major tasks of our time. Innovative clean-tech start-ups play a crucial role in tackling them as they create clean technologies, products, or services that save resources, are climate-neutral, and, in the best case, reduce harmful pollutants. Even though the ideas of these companies are increasingly supported by governments and impact-oriented investors, especially many of the so-called hardware-intensive clean-tech start-ups (HICSs) lack initial funding, particularly during prototyping in the early stages of their founding. The question of how to deal with this issue was explored by our TUM School of Management alumni Thomas Bruderhofer. For his study, he was awarded third place in the Social Impact Award 2021 of the TUM Management Alumni e.V..


Thomas graduated from the TUM Master's program in Management and Technology with a specialization in entrepreneurship and power engineering. While writing his master’s thesis, he also participated in a TUM Entrepreneurial Masterclass. About TUM School of Management, Thomas says: “They provided very valuable courses where I learned about fund-raising for start-ups and methodical approaches to answer my research question for the project.” With the clear goal of actively shaping the start-up scene and getting involved in the expansion of renewable energies, he became part of the Manage and More entrepreneurship community. There, his attention was drawn to CargoKite, founded by former TUM students Amelie Binder, Marcus Bischoff, Tim Linnenweber and Max Perschen.

On a mission of decarbonizing the global cargo shipping industry

To date, there are no market-ready technologies that meet the ambitions set by politicians to reduce emissions. Cargokite, however, intends to change that. In view of the enormous CO2 emissions from global cargo shipping, which even exceed Germany's total CO2 emissions per year, the start-up has set itself the goal of decarbonizing global cargo shipping through the use of autonomous, wind-powered micro-cargo ships. More precisely, the micro-cargo ship is powered by a kite. Combined with a specially designed hydrofoil, the energy of strong high-altitude winds is directly converted into the ship’s locomotion. Additionally, Cargokite’s founders use an intelligent route planner. Through machine learning, the autonomous vessel always determines the optimal route and an accurate arrival time.

Currently, Cargokite is developing its first prototype. The founders want to go into series production with their autonomous sailing ship in just a few years. Like many other HICSs, the company needs substantial funding for this endeavor. However, as with many of these hardware-intensive clean-tech start-ups, investors are hesitant to invest. This is mainly due to the high capital requirements and the significant technical risks associated with the autonomous ship. Thomas has sought for possible solutions and tackled this problem as part of his master's thesis.


Funding for hardware-intensive clean-tech start-ups

In search of an answer to his research question and a solution to the challenges CargoKite was facing, he interviewed founders of various clean-tech start-ups from the energy, mobility, and logistics sectors, fund-raising experts as well as impact investors in leading positions. His work resulted in a fund-raising guide and toolbox that makes it easier for start-ups to attract strategic investors and reduces information asymmetry between the two parties.

In recognition of his passion for solving a social and, moreover, environmental problem, Thomas' master's thesis was awarded third place in the TUM Social Impact Award  2021. This prize is awarded annually by the TUM Management Alumni e.V. to ideas and innovations with social impact.

Looking ahead, Thomas intends to continue his mission and plans to use the prize money for digital tools and services to help clean-tech start-ups scale up more effectively. To young founders in general, he advises them to listen to their gut and trust their intuition. “It is really important for founders to have a strong emotional connection to the problem they want to solve,” says Thomas. “With passion, you will be able to overcome difficult times,” he emphasizes.


The Social Impact Award

Every year, the TUM Management Alumni e. V. grants the Social Impact Award to ideas and innovations with social impact. Students, graduates and alumni of TUM School of Management can submit projects or a thesis that address a social issue or are intended to have a positive impact on society. Criteria include social impact, entrepreneurship, creativity and feasibility.