John Sharp is the CEO and founder of data-driven venture capital firm Hatcher+. With a focus on Climate Tech, AgriFood and other sectors, his organization has a successful track record of 245 investments and 10 exits. Recently, Brinc and Hatcher+ announced a new partnership to support the growth of 300 new climate tech startups over the next three years, leveraging Brinc’s accelerator network and Hatcher+’s AI-powered FAAST platform to identify and invest in the best entrepreneurs and new tech worldwide.
John’s impressive track record and his global perspective are shaped by his diverse experiences across industries and regions. As a staunch advocate for climate tech and decarbonization, he highlights the urgency for immediate action and emphasizes the importance of collaboration in overcoming challenges that lie ahead.
He offers invaluable insights into the pivotal role of climate tech startups in shaping a greener future, delving into investment trends, growth potential, and practical advice tailored to entrepreneurs in the Climate Tech and Agrifood sectors.
Q: Could you please tell us a bit about your background?
Certainly. My journey has been quite diverse, starting from humble beginnings where I worked on a farm and then later held various odd jobs to make ends meet, ranging from working as a janitor to working in retail to working in the music industry. Over time, my career expanded into working in advertising, then broadcasting, then aerospace, then finally into streaming media cybersecurity, and most recently, fintech and venture capital.
I consider it very fortunate that I’ve been able to work in so many different countries, such as Australia, Singapore, China, Hong Kong, Japan, the US, and the UAE – to name a few – as this has really helped me gain knowledge about different business cultures. This career path has also instilled in me a deep appreciation for a large range of occupations and industries, and this has helped me over the years, and especially more recently in my choice of strategic investments.
Q: Let’s start with recent investment trends in Climate Tech and Agrifood startups. Have there been any notable shifts or patterns in investor interest?
There’s a discernible shift in funding, with a growing focus on the emissions-intensive sector, and impact investing in general. Five years ago, impact investing was the domain of a handful of philanthropically focused investors. Today, impact investing has evolved into a profitable, high-priority area for almost all active investors.
Q: On factors that contribute to the growth potential of Climate Tech and Agrifood startups, are there specific areas within these sectors that are particularly attractive to investors?
Ultimately, cost and efficiency are the best drivers of adoption of any new technology. I always interview the Tesla-driving Uber drivers I meet – and all of them cite the reduced cost of fuel, and resulting increased profit margins, as a fundamental reason they love their Tesla.
One of the reasons we have not seen the expected adoption of alternative protein is, despite the enormous advances in manufacturing, there has not been a cost saving to the consumer. So consumers are holding back.
I think one of the areas that holds the most promise for investors in the coming years will be small nuclear reactor installations. This technology has been working for over 70 years on a small scale inside nuclear submarines. It is incredibly safe, clean, and efficient. Hopefully, in the coming years, we will rethink our misguided views on nuclear energy. This is, for me, the single best hope we have for transforming the world – but there is a lot of work that needs to be done to de-demonize it as a fuel source. Decades of misinformation needs to be undone.
Q: What do you believe are the most pressing climate change issues and sustainability challenges?
We are living inside a terrifying feedback loop that not nearly enough people understand. When you do the research, you realize with great clarity that there is a growing chance that our species may not survive. The problem is: the experience of enjoying warm weather in parts of the world that were previously known to have awful weather is not exactly a strong motivator for change.
Ultimately, the solutions will be found – but they will come from a small group of dedicated people, and will need to come well-packaged, with as little political baggage as possible. I am a co-founder in a space-based climate solution called EarthGuard – a solution that could buy us the time needed to address the macro issues in play. There are other solutions out there that could be equally impactful. The bottom line is: there is an urgent need to champion clean technologies and embrace decarbonization. We’re doing that via our CarbonNation fund, in partnership with investors and groups such as Brinc, Startup Bootcamp, and our other co-investment platform partners.
Q: What types of Climate Tech and Agrifood startups play a pivotal role in addressing these challenges?
Startups possess a unique capability to address challenges that more developed corporates may find overwhelming. Their autonomy allows them to excel in specific areas, making them crucial players in the push for clean technologies and sustainability. Examples such as Northvolt Battery Technology, Vestas Wind Energy, and Rubicon’s waste management tech showcase the impactful contributions startups can make.
I just mentioned EarthGuard – EarthGuard is a first principles solution that has the ability to directly reduce the average temperature of the planet by 1.5 degrees Celsius for a period of time long enough to scale up decarbonization, and get permanent solutions in place. We need these kinds of big ideas to be put in place first, so we can buy time for the other solutions to germinate and scale.
Q: What other key factors do you look for in Climate Tech and Agrifood startups?
Investors typically focus on scalability, market potential readiness, and sustainability in the face of competing technologies, when evaluating startups. Metrics such as the total addressable market, customer acquisition costs, and the potential for regulatory compliance play crucial roles. The ability of a startup to navigate regulatory landscapes while maintaining sustainable practices is often a key indicator of its long-term viability.
Q: What practical advice and tips would you offer to entrepreneurs looking to attract investment in the Climate Tech and Agrifood sectors?
Entrepreneurs in these sectors should craft a compelling narrative that emphasizes not only financial potential but also positive environmental impact. Showcasing a clear roadmap for growth and sustainability, and actively participating in networking events and pitch opportunities are solid strategic approaches to attracting investment.
Q: What is Hatcher+ hoping to achieve with Brinc and its accelerator programs?
With Brinc, we aim to identify and invest in startups aligned with our CarbonNation mission, focusing on restoration, climate mitigation, regenerative farming, and greentech. With the help of Brinc’s accelerator programs, we will be seeking to amplify the impact of these startups, and help them achieve their potential – and hopefully, together, we will be able to drive positive change for our species on a global scale, and start the process of repairing and protecting our planet for future generations to enjoy.
Q: How crucial is it for entrepreneurs to build relationships with investors and other stakeholders in the industry?
Building relationships with investors and industry stakeholders is paramount. Beyond financial backing, these relationships offer invaluable mentorship and guidance. Entrepreneurs should authentically engage with professionals on platforms like LinkedIn, attend industry conferences, and participate in pitch events to establish meaningful connections. Having an expert vouch for your strategy or technology can be worth hundreds of hours of due diligence interviews.
Q: Could you please tell us how you came to co-found Hatcher+?
Hatcher+ emerged out of a realization that most venture portfolios were being created organically, with little understanding of the statistical probability of success. Very few people realize how truly difficult it is to succeed in the venture capital industry. Everyone makes the mistake of thinking they are smarter than the next guy… when the fact is that the industry is full of smart people, and only 50% of funds are beating the Nasdaq index.
We decided to conduct large-scale research into better ways to create venture portfolios – and after two to three years, we came to the conclusion that portfolios should consist of a very large group of startups, selected at a 1% or less ratio from all applicants as early as possible in the startup’s life. We also concluded that the fund should invest across a massive, diverse range of sectors and geographies.
This strategy became the basis for our H2 Fund. We’ve also launched a number of other funds, including several funds in the areas of climate tech and decarbonization.
Q: What message would you like to convey to entrepreneurs who are considering pursuing their ideas in these sectors?
For entrepreneurs entering these sectors, my message is: Simply be honest about what your technology can do, the challenges you face, and the uniqueness of your technology. The most experienced impact investors have been doing it for years – and have read millions of words on every subject imaginable. If you’ve truly got something revolutionary, it will find investment, and investors will be excited about its potential.