Should You Start a Cleantech Startup? New Analysis Says Maybe Not

A student considering a career in cleantech entrepreneurship raised a provocative question: if funding for cleantech is limited, does starting another startup actually increase the total good done in the world? The student reasoned that since there are more viable cleantech startups than available funding, getting funded might simply take money away from another equally promising venture, resulting in no net gain. This is a classic counterfactual impact dilemma.

Experts responded with nuance. One expert with due diligence experience noted that many cleantech startups are undifferentiated and shouldn't have been founded, but some that seem ridiculous end up succeeding. The field has plenty of early-stage funders but few late-stage ones, creating a 'valley of death' where companies fail because they can't scale. The expert advised the student to focus on techno-economic analysis early to avoid optimizing the wrong thing.

Another commenter emphasized that while duplication should be avoided, failure to start is much worse than suboptimal allocation. They argued that industry-wide generalities are bound to be wrong; the specific details of what the startup would do matter more. The key is to identify a unique contribution and understand the real bottlenecks and key performance indicators.

In essence, the decision to found a startup should be based on a concrete, well-researched plan rather than broad assumptions. If you can bring something truly different or better, you might increase the pie rather than just slice it differently. But if you're just another me-too company, you might not add much. The takeaway: do your homework, talk to experts, and be honest about your potential impact.