Deep Decarbonization to Non-Luxury Buildings— Kate Frucher, Managing Director at The Clean Fight
Led by Managing Director and Cofounder, Kate Frucher, The Clean Fight is a flagship not-for-profit accelerator, that identifies and scales the top growth-stage climate tech companies from around the world that are looking to expand into New York. The current focus is easy-to-adopt solutions that bring the environmental, economic, and health benefits of deep decarbonization to non-luxury buildings.
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BUSINESS
What does your company do? What makes you unique versus the competition?
The Clean Fight is a flagship business accelerator funded by NYSERDA (New York State Energy Research and Development Authority) and the Department of Energy, focused on helping growth-stage climate tech companies scale in New York.
We do this through high-touch matchmaking with our customer partners to catalyze pilots and deployments; help with finding the right capital solutions through our investor and financing partners; provide bespoke support services; help to understand and navigate the New York landscape; and allocate $1.25M in grants to fund pilots and financings.
What makes us unique is our focus on growth-stage companies, those with a proven and market-tested solution, and a diverse customer base. Our mission is speeding the path to adoption of ready-to-scale solutions (rather than the work of earlier stage accelerators that focus on incubating and commercializing the initial innovation).
We also have a thematic focus for each cohort, which is rare. This enables us and our companies to go much deeper due to their work in the same sector, and enables collaborations, partnerships, and co-selling opportunities between cohort companies.
How are you funding your growth -- revenue, VC, CVC, government grants, M&A?
What are 1-2 lessons you’ve learned along the way?
We’re funded by government grants from New York State and corporate sponsorships.
We’ve learned that with government grants you still need to be focused on diversifying funding. Not only to protect the business from being dependent on a sole source of funding, but because funders want to see their share of your overhead decline, requiring more projects/monies to split indirect cost across.
Our cohort companies, many of whom deal in hardware, are not a natural fit for VCs who are typically looking for software solutions with the high returns that come with the scalability of those technologies.
We’ve learned that it’s critical for our companies to truly work on understanding their business model and ideally be in a position where they’re throwing off cash before they go to VCs. It’s essential to know how the natural cadence of their business lines up with the VC model so they can pitch themselves accordingly in order to have greater success.
They also need new financing mechanisms (which can certainly be market-based), ideally those that qualify as more patient capital. At the moment, the onus is on climate tech companies trying to contort themselves to fit into the VC structure, rather than the market adapting to genuinely meet their needs.
If you had to start over, what are 1-2 tips you’d give yourself in order to be faster, more effective, and higher impact?
We’ve been working on climate tech solutions for buildings, but this holds true more broadly in the climate innovation space. The future has to be focused on making it easier for customers to adopt climate solutions. How do founders take the burden off customers by helping them to navigate to the right solution, take disparate companies and package them into turnkey solution sets, and package financing options that make it financially viable to adopt these innovations? We have to figure out a way to scale demand. I wish I’d been focused on that insight from the beginning.
Outside of your current business, what other 1-2 climate or sustainability sectors seem like promising areas to start a business? What might those solutions look like?
These build on the insight from the previous question. If we’re asking the mass market to adopt climate solutions earlier in the innovation cycle than they would normally (and we need them to do so in order to bend the curve away from climate collapse), then we have to make it less risky and easier for them to do so.
De-risk with new financing solutions. We need innovation in financing that enables either the entrepreneur to package financing into their business model and/or for customers to be able to access project financing to make adopting these solutions viable from a cap-ex perspective. Equally, we need to remove some of the risk that comes with early adoption if we’re trying to push market uptake earlier than they would normally be comfortable with. This means insurance, 3rd party-backed warranties/guarantees, or pay-for-performance structures.
Make it easier to adopt through bundling. There are huge opportunities for platform organizations that figure what is needed from a financing and sales perspective to complete the totality of a project and allow the different solution providers to plug into their platform. This makes it easier for customers who can work with a single company to complete their project, and easier for solutions providers who don’t have to worry about the sales and financing aspects of their business. This has happened in solar but needs to occur across all industries, particularly buildings (Sealed and BlocPower are two good examples of this approach in buildings).
What are some habits and routines that keep you focused, healthy, and sane -- e.g., meditations, exercise, productivity hacks?
I’m religious about exercise, especially the intense cardio flavor, especiallyif I'm able to get outside to do it.
Meditation has been really important to me, but it has been tough to keep up since having kids for some reason.
My productivity hack has to do with post-its, and it’s probably embarrassing to share that widely. :)
What recommendations do you have for our audience -- books, podcasts, quotes, tools?
One of my favorites is this one from Theodore Roosevelt:
“It is not the critic who counts; not the man who points out how the strong man stumbles, or where the doer of deeds could have done them better. The credit belongs to the man who is actually in the arena, whose face is marred by dust and sweat and blood; who strives valiantly; who errs, who comes short again and again, because there is no effort without error and shortcoming; but who does actually strive to do the deeds; who knows great enthusiasms, the great devotions; who spends himself in a worthy cause; who at the best knows in the end the triumph of high achievement, and who at the worst, if he fails, at least fails while daring greatly, so that his place shall never be with those cold and timid souls who neither know victory nor defeat.”
What’s the nicest thing anyone has ever done for you -- outside of your own family?
I was going to talk about my old co-founder, who’s been a true career-long mentor/partner. But then I remembered my sperm donor. I’m in a same-sex marriage, and the friend who generously helped us have a family is by far the most amazing thing anyone has ever done.
Do you have any requests, announcements, or final advice for our listeners?
Request: That everyone, from where they sit, figure out how they can help us transition to a clean economy. I, and, everyone on my team, was working in different sectors just two short years ago. It’s going to take all of us. Together, we need to make this change.
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Note:
THE TORCH is an interview series from Entrepreneurs for Impact. We profile CEOs and investors mitigating climate change. Our goal is to highlight their work and inspire others. As we deal with multiple crisis, from Covid and racial injustice to climate change and economic recession, we need some of this positive light in what seem like dark times. Onward and upward.