Myth-busting climate innovation

To mark climate week, Youth Business International (YBI) and its network member Bangladesh Youth Enterprise Advice and Helpcentre (BYEAH) are putting a spotlight on climate adaptation enterprises and the benefits of investing in youth-led businesses leading the charge in climate solutions.

Our newest paper Young, green and unfunded: how three myths block climate innovation explores how assumptions and misunderstandings form myths which are slowing innovation and blocking advancement of new technologies. This is  curtailing business growth and forcing climate-effected communities to depend on handouts instead of bolstering their resilience and economic growth.

• Myth 1: Adaptation is charity: Investing in climate adaptation is an insurance policy mitigating billion if not trillion dollar losses due to climate and extreme weather impacts. Early investment proves five times more cost-effective than delayed action. Climate adaptation is a profit driver, not a philanthropic endeavor.
• Myth 2: Innovation is being measured backwards: Asset-light and community driven enterprises are the backbone of the climate adaptation industry. These scalable grass-roots businesses are systemically overlooked for investment in favour of VC ready, fast-growth tech start-ups.
• Myth 3: Climate ventures are capital intensive and unsuitable for youth. Many climate ventures do not require heavy industry or infrastructure to succeed. Youth-led businesses are often community-based, service solutions or digital platforms requiring limited physical capital.

These myths result in a $280-330 billion annual funding gap, however there is not a global shortage of investment funds, but a trust gap between innovative climate business models and traditional evaluation frameworks. Capital fails to flow to youth-led climate enterprises due to institutional inability to accurately assess their risk profiles and unique value propositions.

By integrating ecosystem support, building alternative credit assessment models and implementing policy reforms removing barriers to entry for young founders, youth-led climate enterprises can thrive. Empowering the communities at the sharp end of the problems, best placed to identify and harness the most effective opportunities, will lead to innovation, economic growth, and self-sufficiency.

This approach reduces dependency on handouts while building resilience where it is needed most.

Read more