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When it comes to climate tech solutions, there is a “tremendous capital shortfall”, says Edwin Conway, senior managing director and global head of BlackRock Alternative Investors.
BAI manages around $315 billion in assets across across private equity, private credit, infrastructure debt and equity, and hedge funds. Last year, it established a joint venture with Singaporean investor Temasek to invest in “next generation” companies with technology that contributes to the transition to a net-zero economy.
“It is going to help us define climate solutions as a standalone asset class,” Conway tells New Private Markets in this 10-minute podcast. “That is both essential to our collective mission and a really historic investment opportunity created by this net-zero transition.”
BAI is one of a number of firms raising capital to invest in climate solutions. Some firms are focusing on one particular slice of the private markets ecosystem. Goldman Sachs, for example, is raising a growth equity fund focused on climate solutions, as is Los Angeles-based firm FullCycle Climate Partners. Other firms, such as TPG and Brookfield, are raising capital to invest in climate solutions across various asset classes.
“When we looked at the universe of capital that exists today to support this innovation – to support this growth – I believe there is a tremendous capital shortfall,” says Conway. “Yet you have a significant amount of innovation happening. For us, we get excited, because in my mind that’s white space.”
Conway also highlighted the desire among BlackRock’s clients to increase their private markets exposure, particularly to infrastructure equity and private credit, “areas in which we can continue to lean in and help clients, in areas we believe they are underallocated and underserved in many respects”.