Last month, Credit Suisse released their 2022 equities outlook and the top theme was decarbonization. Coming out of COP26, institutional financial managers committed $57T (yes, trillion) of AUM for net-zero by 2050. As of 2020, the number is $16T.
In addition to an increase of capital with net-zero targets, 90% of global emissions now have a net-zero target by at least 2050. To meet these goals, technologies like solar and battery will need to be scaled rapidly, we continue to believe that the only way to meet this demand without prohibitive labor costs is through software.
Lastly, CS listed electrification as the number one trend within the theme. The analysis driving this decision indicates that global electricity demand will double between now and 2050 primarily due to emerging markets and electrifying transportation.
At Energize, we like to say growth equity investing comes down to this question, "can this company go from $30M in revenue to $300M?"
To do so, the markets and capital available to them must be significantly large.
Reports like this one add to the growing amount of evidence that sustainability is no longer a specialized vertical and the winners in the market will have the ability to hit milestones that make for successful growth equity investments.