Earth Day 2025: Investing in the Demand Side of a Reawakening

Investors need to rethink their role—to not just be financiers of innovation but to become architects of systems change

Last year to commemorate Earth Day, I wrote about "A Great Awakening"—a call for bolder, more systemic action in how we approach sustainability. While incremental progress has its place, we no longer have the luxury of small steps. Our systems of production and consumption have long been extractive, and reversing that damage requires a full-scale reawakening—one that redesigns industries, rethinks business models, and shifts how we work in partnership with the planet.

As I reflect on that post a year later, I realize there’s a critical piece of this reawakening that we may be overlooking—one that’s especially relevant to my work as a venture investor. Venture capital tends to focus on the supply side—funding entrepreneurs who are creating new products, services, and solutions. Renowned venture investor Peter Thiel calls venture and innovation the ultimate zero to one action – creating something where there had been nothing. But the question is: does the “if you build it, they will come” philosophy really stand up in reality?

While innovation is a necessary driver of systemic change, I don’t believe it’s enough on its own. A breakthrough technology, material, or business model means little if there is no market ready to adopt it. A reawakening cannot happen in a vacuum. If we invest billions into building new climate solutions but fail to cultivate demand, our impact will remain siloed among early adopters, never reaching the mainstream and the critical scale we need to bend the curve on all ecological impacts.

That’s why I believe investors need to broaden their aperture—to look beyond just the supply side and commit to investing in the demand side. This means market education, field-building, growing customer awareness, and ultimately, shifting behaviors. It’s a paradigm shift for venture investors, who are often trained to assume that demand will take care of itself “if the product-market fit is there.” But that’s not a sustainable or successful strategy—not if we want to drive lasting transformation. So what can investors do to help scale demand-side adoption?

How investors can build demand for climate solutions

Investors need to rethink their role—to not just be financiers of innovation but to become architects of systems change by investing in developing market demand. One of the most powerful ways to accelerate demand is through policy and regulatory shifts. We’ve seen firsthand how government action can transform industries. Take the Inflation Reduction Act (IRA), for example. By providing tax credits and incentives for electric vehicles, the IRA more than doubled projected EV sales in the U.S. by 2030. In 2023—the first full year the IRA credits were in effect—EV sales jumped 50% year over year. These types of interventions reduce the “green premium” that often makes sustainable options cost-prohibitive, creating a stronger business case for customers to make the switch. Venture investors have a role to play in advocating for these types of policies, ensuring that emerging climate solutions have the same kind of tailwinds that helped scale renewable energy, electric transportation, and other critical sectors.

Another crucial piece of demand-building is setting clear product standards. Today, consumers and businesses alike struggle to navigate the noise of sustainability claims—what’s truly better for the planet versus what’s just good marketing? Without clear frameworks, companies risk unintentionally greenwashing or making decisions based on incomplete information. Standardized metrics and industry-wide benchmarks provide a common language for evaluating products, giving buyers more confidence in choosing sustainable alternatives. Investors can support the development and adoption of these standards, helping ensure that the best solutions rise to the top.

Beyond policy and standards, market education is an essential and often overlooked driver of demand. It’s easy to assume that if a better product exists, customers will simply adopt it. But that’s not how markets work—especially when dealing with nascent industries like biomaterials or alternative proteins. Many consumers and businesses aren’t even aware that these alternatives exist, let alone understand their benefits or how to integrate them into their operations. Education efforts—whether through events, conferences, networking, or content like webinars, whitepapers, and blogs—play a critical role in introducing new ideas, shifting mindsets, and reducing friction in adoption. Investors can help by both funding and participating in these efforts, and ensuring that market-building isn’t an afterthought but a core part of their investment strategy.

Finally, one of the most effective ways to build demand is through cross-sector collaboration. The transition to a regenerative economy isn’t something any one company, investor, or industry can do alone. It requires coalitions of stakeholders—founders, investors, policymakers, nonprofits, and consumer groups—all working together. Too often, these groups operate in silos, missing opportunities to align on shared goals and accelerate adoption. Investors are uniquely positioned to help convene these conversations, breaking down barriers between sectors and fostering the kind of collaboration that leads to faster, more effective scaling of solutions.

A new mindset for investors

This shift in thinking is not just necessary—it’s urgent. If we want to drive systemic change, investors must take responsibility for both supply and demand—for building not just solutions, but the conditions that allow them to scale. Demand creation isn’t just about adoption; it’s about lowering costs, increasing accessibility, and making climate solutions the default choice.

This Earth Day, let’s remember: reawakenings require fundamental shifts in how we operate. If we’re serious about building a 21st-century economy that works in partnership with the Earth, investors can’t just back innovation—we must actively cultivate the markets that will bring it to life.

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